banks, characteristics explain a substantial part of variation in banks profitability and interest margin. Low capitalization ratio tends to increase banks profitability. Indicating the U.K banks follow a risk seeking approach. Results also indicate that credit risk has a negative impact on ROE and NIM but have a positive relationship with ROA suggesting that banks in the U.K are offering high risk loans which attract a higher rate of interest. However negative impact of overheads on ROE and NIM suggests that lack of confidence towards the management of expenses by U.K banks. One reason could be that they operate in highly competitive environment that has forced banks not to overcharge their customers. On the other overheads has a positive impact on NIM, size. On the other hand inflation has a positive relationship with ROA and NIM suggesting that U.K banks prediction of future banks is accurate and are accordingly managing their operational cost. However, inflation has a negative effect on ROE. In general the results of this stating the support the existing literature and agrees of those of what researchers have quoted. These results indicate that profitability and not interest margin of commercial banks in the U.K is mainly influenced by high lending towards risk seeking approach and a very competitive U.K banking sector. 6.3 LIMITATION OF THE STUDY The data used for analyzing performance and profitability in the U.K commercial banking sector was collected from bank scope database. There has been inconsistency with data and the financial information which had to be researched and analyzed. Firstly the data on priority sector lending had information only on high street banks and was an overall figure. This variable had to be removed from the sample because of this reason. Further, there was an unavailability of a reverse ratio in the U.K, so this variable also had to be excluded. With this regard to the credit risk the data on loan loss provisions and loan loss revenues had a lot of missing data on the balance sheet and income statement, hence, loans and deposits had to be calculated to det>