RELATIONSHIP BETWEEN CORPORATE GOVERNANCE ATTRIBUTES AND FINANCIAL PERFORMANCE OF SELECTED NIGERIAN DEPOSIT MONEY BANKS

Abstract

The subject of corporate governance has spurred research interests with respect to principal- agent relationship in recent times, especially with the existence of publicly quoted companies. Several cases of performance inefficiencies, deterioration in performance or total liquidation of various organizations around the world, have been ascribed to lack of managerial leadership quality and corporate governance. This study therefore examines the effect of corporate governance attribute on the financial performance of selected Nigerian Deposit Money Banks. Ex-post facto research design was employed for this study. The population of the study consists of fourteen (14) NDMBs. The sample size of seven (7) NDMBs was arrived at using simple purposive sampling technique due to due banks which have their annual report and accounts readily accessible for the study period. Analytical techniques that were used in the study consist of both descriptive and inferential statistics. Panel regression was used to examine the relationship between corporate governance attributes and financial performance of selected NDMBs. The result of panel regression analysis on the relationship between corporate governance attributes and financial performance of selected NDMBs revealed that all the sampled variables were correlated positively with ROI (0.8620) SIZE (0.0983), Board Size (0.0784), Audit independence (0.0683) and CEO duality (0.0209) respectively. The study revealed that there is a significant relationship between corporate governance attribute on the financial performance of selected Nigerian Deposit Money Banks. It is therefore recommended that as practicable as possible, Nigeria Deposit Money Banks should ensure that they maintain a clear cut separation of the roles of board Chairman and Chief executive officer (CEO-duality).