The aim of this study is to explore the impact of risk management practices on the financial performance of the Cooperative and Agricultural Credit Bank (CAC Bank) in Aden from 2016 to 2023, within Yemen’s challenging context of political instability and banking sector fragmentation. The study adopted a quantitative cross-sectional design, data were collected from 94 employees through a structured questionnaire measuring five dimensions of risk management—credit, liquidity, operational, market, and regulatory/compliance—alongside perceived financial performance indicators such as profitability, cost efficiency, and operational stability. For appropriate diagnostic testing,  Ordinary least squares regression analysis was applied.