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Board Diligence And Financial Performance: Evidence From Nigerian Deposit Money Banks

Author

Listed:
  • Wasiu Abiodun SANYAOLU

    (Department of Accounting, Crescent University, Abeokuta, Ogun State, Nigeria)

  • Babatunde Titus ADEJUMO

    (Osun Debt Management Office, Abere, Osogbo, Osun State, Nigeria)

Abstract

The study examined the effect of board diligence on financial performance of listed deposit money banks. Data of the 10 selected DBMs were obtained from their annual financial statements from 2012 to 2018 using an ex post fact research design and purposive sampling technique. The data were analysed using inferential statistics and hypothesis testing using Generalised Method of Moment (GMM). The study found that board diligence has significant negative effect on financial performance of Nigerian listed DBMs. As regards the controlled variables, only capital adequacy and firm size were found to positively and significantly influence financial performance. Liquidity ratio was found to have direct but no significant effect on financial performance while nonperforming loan negatively and insignificantly affect financial performance. The study concludes that bard diligence reduces financial performance. It is therefore recommended that preference should be given to the quality of board meeting and not the quantity and that issues that have implications on performance should be given utmost attention at board meetings.

Suggested Citation

  • Wasiu Abiodun SANYAOLU & Babatunde Titus ADEJUMO, 2020. "Board Diligence And Financial Performance: Evidence From Nigerian Deposit Money Banks," Contemporary Economy Journal, Constantin Brancoveanu University, vol. 5(3), pages 161-169.
    • Handle: RePEc:brc:brccej:v:5:y:2020:i:3:p:161-169
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    References listed on IDEAS

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    More about this item

    Keywords

    Board meetings; profitability and GMM;

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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