BOARD CHARACTERISTICS AND FINANCIAL PERFORMANCE OF DEPOSIT MONEY BANKS IN NIGERIA

Abstract

The broad objective of the study is to ascertain board characteristics and financial performance of deposit money banks in Nigeria while the specific objectives of the study are to ascertain the impact of board size and board composition on the financial performance of deposit money banks in Nigeria. The study used secondary data of 13 quoted deposit money banks on the floor of the Nigerian Stock Exchange over a period of 5 years (2015-2019). The study employed multiple regression techniques for the data analysis with the help of EViews 11.0 econometric software. The study revealed that board characteristics proxied by board size and board composition are positively significant to the financial performance of deposit money banks in Nigeria. This implies that board characteristics have a direct impact on the financial performance of deposit money banks in Nigeria. This connotes that increase in board size and increase in the number of non-executive directors sitting on the board will go a long way in increasing the financial performance of deposit money banks in Nigeria. The implication of the findings of this study will be relevant to corporate bodies, policy makers/regulators and to shareholders. The study recommends that regulatory authorities should ensure the increase in the number of persons sitting on the board and they should also ensure the increase in the number of non-executive directors sitting on the board since they are likely to bring their knowledge, expertise and integrity to bear in enhancing the financial performance of deposit money banks in Nigeria