Capital Adequacy and the Performance of Deposit Money Banks in Nigeria
Abstract
The impact of capital adequacy structure on the performance of deposit money banks in Nigeria is examined in this study. Objectives of the study were; to examine the impact of total assets of banks on the performance of deposit money banks in Nigeria and to investigate the role equity capital on the performance of deposit money banks. The methodology used for this study was the desk survey method and data were sourced from annual report of banks, CBN Statistical Bulletin and journal articles and the study was analyzed using the least square multiple regression technique. Empirical test indicated that, there was a significant relationship between total asset and the return on equity of Access Bank Plc, and also that, there was a significant relationship between equity capital and the return on equity of Access Bank Plc. The study recommended, among others that provision of adequate capital regulation; the dragging effect that core capital has on profitability needs to be monitored and appraised constantly in order not to reduce shareholders’ confidence in investing in the bank by way of a possible capital shore-up.
Keywords
Capital adequacytotal assetsdeposit money banksequity capital
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