Purpose – This paper adds to the body of existing knowledge in banking and financial management by providing a conceptual analysis of striking a balance between financial soundness and profitability to promote sustainable banking.

Design / Methodology / Approach – This study explored the concept of financial soundness and profitability and discussed various literature related to the subject from developed to developing economies and making inferences into their work for policy and practice. A conceptual model was developed to help industry to adopt to balance these objective dimensions.

Findings – The literature revealed there is an interplay between financial soundness and profitability measures since they affect each other significantly. Capital adequacy and liquidity inversely affect profitability, while assets and management quality had positive impact and vice versa. Over concentration on one set of dimensions would adversely affect the other thereby hurting the business operations.

Practical Implications – The increase in knowledge of the need to balance financial soundness with profitability pursuit would promote business sustainability, increase shareholders’ value, and create a competitive advantage in the business environment. This has important and constructive perspectives for regulators, management of banks and all stakeholders as to the management of financial soundness and profitability to enable them to achieve a sustainable balance in the banking environment.

Originality / Value – This study provides clarity, insights and demystifies the ambiguity surrounding the need to balance financial soundness with profitability in a competitive business environment. It developed a unique conceptual model for adoption and provided some strategies to help strike the needed balance, which has been a difficult task for industry players over time.