IIARD International Institute of Academic Research and Development

IIARD INTERNATIONAL JOURNAL OF BANKING AND FINANCE RESEARCH (IJBFR )

E-ISSN 2695-1886
P-ISSN 2672-4979
VOL. 9 NO. 4 2023
DOI: https://doi.org/10.56201/ijbfr.v9.no4.2023.pg139.158

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Capital Structure Effects on Corporate Finance Base Performance of Named Nigerian Based Banks

Ori, Bertha Chinyere

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Abstract

Capital structure is critical and crucial for business organization. This study investigated capital structure effects on corporate finance base performance of named Nigerian based banks. The Ex- post facto research design was employed, with a study population consisting of twenty- two deposit money banks that were dully registered by CBN and were dully licensed to operate as at 2017. The purposive sampling technique was employed in choosing sample frame from 2006 to 2017 with four selected banks. The study concentrated on secondary data obtained from published finance base statements of sampled deposit money banks; generated from NSE fact books, official list of NSE, annual report and accounts of banks. For clarity sake, interest are; total assets, STD, LTD, shareholders’ funds, dividend value, market price and profit figure for each finance year from 2006-2017. Panel data structure from 2006 to 2017 which is twelve observations years as stated in annual reports and accounts of sampled banks was used and analyzed using Eview 9 statistical package, correlogram test, panel unit root, panel co-integration, error correction model, panel OLS method and panel granger casuality test. Econometric method used followed this step; First, test for panel unit root was conducted which is necessary because of presence of unit roots in used series, secondly, co-integration association between used proxies in long run was tested with panel co-integration test. Finally, conditional on co-integration, for such causal association between parameters was explored through employing Granger causality test. The result also showed that, all parameter shows negative coefficient indicating positive relationship and movement with criterion parameter with exception of short term debt and equity financing thus affecting proposed apriori expectation. It was concluded that, there is a strong positive links and connection between selected variables

keywords:

Banks, Capital, Effects, Finance, Nigeria, Structure.

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References:

Adesina, J. B., Nwidobie, M. B., & Adesina, O. O. (2015).Capital structure and financial
performance in Nigeria. International Journal of Business and Social Research, 5 (2) 21-31.

Akinlo, O. (2011). Determinants of capital structure: Evidence from Nigerian panel data. African
Economic and Business Review, 9(1), 1-16.

Anarfo, B. E. (2015). Capital structure and bank performance: Evidence from Sub-Sahara
Africa.European Journal of Accounting Auditing and Finance Research, 3(3), 1-20.

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