The Townsville Crocodiles will not be a part of the NBL in 2016/17 after club directors withdrew from the competition due to financial issues.

The Crocodiles won just 11 of their 28 games and finished second-last in 2015/16

NBL general manager Jeremy Loeliger said, while it was disappointing to see another club fold, the league had a responsibility to ensure NBL teams were commercially sustainable.

"We cannot allow our players, fans or sponsors to have any lingering doubt as to the longevity of our clubs," he said in a statement.

The league said all financial commitments made to players for the past season would still be met as it manages the Crocodiles' "transition".

"We will always do everything we can to support all of our teams to ensure this is one of the leading competitions in the world and we spent considerable time reviewing the Townsville situation and trying to generate local support for the Crocodiles," Loeliger said.

"However, there is no point in trying to sustain a club that has itself resolved that it cannot survive in its home town.

In reviewing the competition and contracting system in recent times, we were very conscious of not restricting the competition to cater to the lowest common denominator, but instead setting it up to be everything that it possibly can be.

There will still be two Queensland teams in the competition next season, with the revived Brisbane Bullets joining the Cairns Taipans.