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Firm characteristics and financial performance of listed deposit money banks in Nigeria

Author

Listed:
  • Wisdom Okere
  • John Okoye Nonso
  • Njogo Bibiana
  • Sharon Uke
  • Cynthia Okere

Abstract

This study examined the effect of firm characteristics on the financial performance of listed deposit money banks in Nigeria. The study used panel ordinary least squares regression and findings show that there is a positive insignificant association between capital adequacy and return on assets. In addition, there is a negative insignificant relationship between board size and return on assets. Based on findings, this study recommends that deposit money banks should keep their capital adequacy ratio (CAR) above the minimum requirement set by the regulator because banks with high CAR are perceived to be more stable, efficient, safe and likely to meet their financial obligations. This would improve the confidence of investors and customers, therefore, leading to a positive effect on overall bank performance. Furthermore, the study recommends that having a smaller board size reduces agency problems within the firm; making the board more effective promotes improved financial performance.

Suggested Citation

  • Wisdom Okere & John Okoye Nonso & Njogo Bibiana & Sharon Uke & Cynthia Okere, 2024. "Firm characteristics and financial performance of listed deposit money banks in Nigeria," American Journal of Finance and Accounting, Inderscience Enterprises Ltd, vol. 8(2), pages 150-163.
    • Handle: RePEc:ids:amerfa:v:8:y:2024:i:2:p:150-163
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