{"id":3873,"date":"2026-09-18T09:01:45","date_gmt":"2026-09-18T09:01:45","guid":{"rendered":"https:\/\/birpub.org\/ijqscpe\/?post_type=journal_article&#038;p=3873"},"modified":"2026-09-18T09:01:46","modified_gmt":"2026-09-18T09:01:46","slug":"effect-of-non-performing-loans-on-banks-willingness-to-finance-construction-projects-in-enugu-state-nigeria","status":"publish","type":"journal_article","link":"https:\/\/birpub.org\/ijqscpe\/journal_article\/effect-of-non-performing-loans-on-banks-willingness-to-finance-construction-projects-in-enugu-state-nigeria\/","title":{"rendered":"Effect of Non-Performing Loans on Banks Willingness to Finance Construction Projects in Enugu State, Nigeria"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\"><strong>Uroegbulam, Victor Ebere<sup>1\u00a0 <\/sup>&amp;\u00a0 Dr. Chukwuenye Agatha<sup> 2<\/sup><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Abstract<\/strong>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><em>This study examined the effect of non-performing loans on banks\u2019 willingness to finance construction projects in Enugu State, Nigeria. Specifically, the study sought to determine the effect of loan default rates on credit approval and to evaluate the effect of bad-debt recovery challenges on the volume of bank financing for construction projects in Enugu State. A descriptive survey research design was adopted. Primary data were collected through a structured questionnaire administered to bank staff involved in credit assessment and lending decisions. The study population comprised 1,498 bank staff, from which a sample size of 306 respondents was determined using the Freund and Williams formula at a 5% margin of error. Of the 306 questionnaires administered, 231 were correctly completed and returned, representing a valid response rate of 75.5%. The data were analysed using descriptive statistics and inferential statistics, while the hypotheses were tested using the Z-test. The findings revealed that loan default rate had a statistically significant negative effect on credit approval for construction projects (Z = \u22128.043, p &lt; .05). Similarly, bad-debt recovery challenges had a statistically significant negative effect on the volume of bank financing for construction projects (Z = \u22128.372, p &lt; .05). The study concluded that increasing loan default rates and challenges associated with bad-debt recovery adversely affect banks\u2019 willingness to approve and provide financing for construction projects in Enugu State. The study recommends that banks strengthen their credit-risk assessment, loan-monitoring, and debt-recovery mechanisms to reduce loan defaults, improve recovery efficiency, and enhance confidence in financing viable construction projects.<\/em><em><\/em><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong><em>Keywords: <\/em><\/strong><em>Non-performing loans; Loan default rate; Bad-debt recovery; Bank financing; Construction projects; Credit approval; Construction finance; Enugu State, Nigeria.<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong><em>Cite<\/em><\/strong><em>: <\/em>Uroegbulam, V. E.<sup>&nbsp; <\/sup>&amp; Chukwuenye, A. (2026). Effect of Non-Performing Loans on Banks Willingness to Finance Construction Projects in Enugu State, Nigeria.<em> International Journal of Quantity Surveying, Construction and Property Economics,4 (3), 28-48. <\/em>https:\/\/doi.org\/10.5281\/zenodo.22827350<\/p>\n\n\n\n<div data-wp-interactive=\"core\/file\" class=\"wp-block-file\"><object data-wp-bind--hidden=\"!state.hasPdfPreview\" hidden class=\"wp-block-file__embed\" data=\"https:\/\/birpub.org\/ijqscpe\/wp-content\/uploads\/sites\/14\/2026\/09\/IJQSCPE_4328-48.pdf\" type=\"application\/pdf\" style=\"width:100%;height:600px\" aria-label=\"Embed of IJQSCPE_43,28-48.\"><\/object><a id=\"wp-block-file--media-36cfe13c-b21c-4027-976b-bc9faf64b707\" href=\"https:\/\/birpub.org\/ijqscpe\/wp-content\/uploads\/sites\/14\/2026\/09\/IJQSCPE_4328-48.pdf\">IJQSCPE_43,28-48<\/a><a href=\"https:\/\/birpub.org\/ijqscpe\/wp-content\/uploads\/sites\/14\/2026\/09\/IJQSCPE_4328-48.pdf\" class=\"wp-block-file__button wp-element-button\" download aria-describedby=\"wp-block-file--media-36cfe13c-b21c-4027-976b-bc9faf64b707\">Download<\/a><\/div>\n","protected":false},"author":1,"template":"","journal_article_cats":[220],"class_list":["post-3873","journal_article","type-journal_article","status-publish","hentry","journal_article_cat-vol-4-no-3"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.1 (Yoast SEO v28.1) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Effect of Non-Performing Loans on Banks Willingness to Finance Construction Projects in Enugu State, Nigeria - International Journal of Quantity Surveying, Construction and Property Economics (IJQSCPE)<\/title>\n<meta name=\"description\" content=\"This study examined the effect of non-performing loans on banks\u2019 willingness to finance construction projects in Enugu State, Nigeria. Specifically, the study sought to determine the effect of loan default rates on credit approval and to evaluate the effect of bad-debt recovery challenges on the volume of bank financing for construction projects in Enugu State. A descriptive survey research design was adopted. Primary data were collected through a structured questionnaire administered to bank staff involved in credit assessment and lending decisions. The study population comprised 1,498 bank staff, from which a sample size of 306 respondents was determined using the Freund and Williams formula at a 5% margin of error. Of the 306 questionnaires administered, 231 were correctly completed and returned, representing a valid response rate of 75.5%. The data were analysed using descriptive statistics and inferential statistics, while the hypotheses were tested using the Z-test. The findings revealed that loan default rate had a statistically significant negative effect on credit approval for construction projects (Z = \u22128.043, p &lt; .05). Similarly, bad-debt recovery challenges had a statistically significant negative effect on the volume of bank financing for construction projects (Z = \u22128.372, p &lt; .05). The study concluded that increasing loan default rates and challenges associated with bad-debt recovery adversely affect banks\u2019 willingness to approve and provide financing for construction projects in Enugu State. The study recommends that banks strengthen their credit-risk assessment, loan-monitoring, and debt-recovery mechanisms to reduce loan defaults, improve recovery efficiency, and enhance confidence in financing viable construction projects.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/birpub.org\/ijqscpe\/journal_article\/effect-of-non-performing-loans-on-banks-willingness-to-finance-construction-projects-in-enugu-state-nigeria\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Effect of Non-Performing Loans on Banks Willingness to Finance Construction Projects in Enugu State, Nigeria\" \/>\n<meta property=\"og:description\" content=\"This study examined the effect of non-performing loans on banks\u2019 willingness to finance construction projects in Enugu State, Nigeria. Specifically, the study sought to determine the effect of loan default rates on credit approval and to evaluate the effect of bad-debt recovery challenges on the volume of bank financing for construction projects in Enugu State. A descriptive survey research design was adopted. Primary data were collected through a structured questionnaire administered to bank staff involved in credit assessment and lending decisions. The study population comprised 1,498 bank staff, from which a sample size of 306 respondents was determined using the Freund and Williams formula at a 5% margin of error. Of the 306 questionnaires administered, 231 were correctly completed and returned, representing a valid response rate of 75.5%. The data were analysed using descriptive statistics and inferential statistics, while the hypotheses were tested using the Z-test. The findings revealed that loan default rate had a statistically significant negative effect on credit approval for construction projects (Z = \u22128.043, p &lt; .05). Similarly, bad-debt recovery challenges had a statistically significant negative effect on the volume of bank financing for construction projects (Z = \u22128.372, p &lt; .05). The study concluded that increasing loan default rates and challenges associated with bad-debt recovery adversely affect banks\u2019 willingness to approve and provide financing for construction projects in Enugu State. The study recommends that banks strengthen their credit-risk assessment, loan-monitoring, and debt-recovery mechanisms to reduce loan defaults, improve recovery efficiency, and enhance confidence in financing viable construction projects.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/birpub.org\/ijqscpe\/journal_article\/effect-of-non-performing-loans-on-banks-willingness-to-finance-construction-projects-in-enugu-state-nigeria\/\" \/>\n<meta property=\"og:site_name\" content=\"International Journal of Quantity Surveying, Construction and Property Economics (IJQSCPE)\" \/>\n<meta property=\"article:modified_time\" content=\"2026-09-18T09:01:46+00:00\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/birpub.org\\\/ijqscpe\\\/journal_article\\\/effect-of-non-performing-loans-on-banks-willingness-to-finance-construction-projects-in-enugu-state-nigeria\\\/\",\"url\":\"https:\\\/\\\/birpub.org\\\/ijqscpe\\\/journal_article\\\/effect-of-non-performing-loans-on-banks-willingness-to-finance-construction-projects-in-enugu-state-nigeria\\\/\",\"name\":\"Effect of Non-Performing Loans on Banks Willingness to Finance Construction Projects in Enugu State, Nigeria - International Journal of Quantity Surveying, Construction and Property Economics (IJQSCPE)\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/birpub.org\\\/ijqscpe\\\/#website\"},\"datePublished\":\"2026-09-18T09:01:45+00:00\",\"dateModified\":\"2026-09-18T09:01:46+00:00\",\"description\":\"This study examined the effect of non-performing loans on banks\u2019 willingness to finance construction projects in Enugu State, Nigeria. Specifically, the study sought to determine the effect of loan default rates on credit approval and to evaluate the effect of bad-debt recovery challenges on the volume of bank financing for construction projects in Enugu State. A descriptive survey research design was adopted. Primary data were collected through a structured questionnaire administered to bank staff involved in credit assessment and lending decisions. The study population comprised 1,498 bank staff, from which a sample size of 306 respondents was determined using the Freund and Williams formula at a 5% margin of error. Of the 306 questionnaires administered, 231 were correctly completed and returned, representing a valid response rate of 75.5%. The data were analysed using descriptive statistics and inferential statistics, while the hypotheses were tested using the Z-test. The findings revealed that loan default rate had a statistically significant negative effect on credit approval for construction projects (Z = \u22128.043, p &lt; .05). Similarly, bad-debt recovery challenges had a statistically significant negative effect on the volume of bank financing for construction projects (Z = \u22128.372, p &lt; .05). The study concluded that increasing loan default rates and challenges associated with bad-debt recovery adversely affect banks\u2019 willingness to approve and provide financing for construction projects in Enugu State. 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Specifically, the study sought to determine the effect of loan default rates on credit approval and to evaluate the effect of bad-debt recovery challenges on the volume of bank financing for construction projects in Enugu State. A descriptive survey research design was adopted. Primary data were collected through a structured questionnaire administered to bank staff involved in credit assessment and lending decisions. The study population comprised 1,498 bank staff, from which a sample size of 306 respondents was determined using the Freund and Williams formula at a 5% margin of error. Of the 306 questionnaires administered, 231 were correctly completed and returned, representing a valid response rate of 75.5%. The data were analysed using descriptive statistics and inferential statistics, while the hypotheses were tested using the Z-test. The findings revealed that loan default rate had a statistically significant negative effect on credit approval for construction projects (Z = \u22128.043, p &lt; .05). Similarly, bad-debt recovery challenges had a statistically significant negative effect on the volume of bank financing for construction projects (Z = \u22128.372, p &lt; .05). The study concluded that increasing loan default rates and challenges associated with bad-debt recovery adversely affect banks\u2019 willingness to approve and provide financing for construction projects in Enugu State. The study recommends that banks strengthen their credit-risk assessment, loan-monitoring, and debt-recovery mechanisms to reduce loan defaults, improve recovery efficiency, and enhance confidence in financing viable construction projects.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/birpub.org\/ijqscpe\/journal_article\/effect-of-non-performing-loans-on-banks-willingness-to-finance-construction-projects-in-enugu-state-nigeria\/","og_locale":"en_US","og_type":"article","og_title":"Effect of Non-Performing Loans on Banks Willingness to Finance Construction Projects in Enugu State, Nigeria","og_description":"This study examined the effect of non-performing loans on banks\u2019 willingness to finance construction projects in Enugu State, Nigeria. Specifically, the study sought to determine the effect of loan default rates on credit approval and to evaluate the effect of bad-debt recovery challenges on the volume of bank financing for construction projects in Enugu State. A descriptive survey research design was adopted. Primary data were collected through a structured questionnaire administered to bank staff involved in credit assessment and lending decisions. The study population comprised 1,498 bank staff, from which a sample size of 306 respondents was determined using the Freund and Williams formula at a 5% margin of error. Of the 306 questionnaires administered, 231 were correctly completed and returned, representing a valid response rate of 75.5%. The data were analysed using descriptive statistics and inferential statistics, while the hypotheses were tested using the Z-test. The findings revealed that loan default rate had a statistically significant negative effect on credit approval for construction projects (Z = \u22128.043, p &lt; .05). Similarly, bad-debt recovery challenges had a statistically significant negative effect on the volume of bank financing for construction projects (Z = \u22128.372, p &lt; .05). The study concluded that increasing loan default rates and challenges associated with bad-debt recovery adversely affect banks\u2019 willingness to approve and provide financing for construction projects in Enugu State. 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