Empirical Investigation of Corporate Board Characteristics and Deposit Money Banks (DMBS) Performance in Nigeria: 2008-2017 | Chapter 3 | Insights into Economics and Management Vol. 4

The analysis empirically examines the features of the corporate board and the performance of Deposit Money Banks (DMBs) in Nigeria for the period 2008-2017. It is driven by investors’ lack of trust in the stock market, ongoing problems with agencies and the insolvency of major companies, such as banks. The general objective of this analysis is to examine the effect of the characteristics of the corporate board on the financial performance of DMBs in Nigeria. Based on the literature discussed, four study models/hypotheses were formulated. The significant factors that influence the success of DMBs in the Nigerian banking industry are also considered. Three of the mentioned were investigated in this study DMBs will use a basic Judgmental Sampling Method from 2008 to 2017 over a span of 10 years. The study population is made up of all the 21 DMBs listed as of 2019 on the Nigerian Stock Exchange. An econometric e-view was used to evaluate the data obtained for the analysis. Using the random effect model, the panel data was further analysed. It was found that, among others, board skills reflect a constructive and essential relationship with benefit for the year. The implication of the results is that the corporate governance practises were not properly enforced by each DMB examined, hence the explanations for the negative impacts of the independent variables except in the case of board qualification. The research supports the relationship between corporate governance and company results, but the relationship is relevant only at the level of board qualification and benefit for the year. The negative relationship between board independence and the success of DMBs (EPS) can be due to the fact that in developing countries such as Nigeria, the idea of board independence is a recent phenomenon, and thus it could take a few more years to have a major effect on financial performance. Critical attention should therefore be paid to corporate governance practises, in particular the CBN corporate governance codes, for better performance in Nigeria’s banking sector.

Author (s) Details

T. F. I. Nwanne
Department of Accounting/Finance, Godfrey Okoye University, P.M.B. 01014, Enugu, Nigeria.

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