| Popis: |
The study examined the effect of equity financing on the financial performance of listed deposit money banks in Nigeria. Return on Assets was used as a measure of financial performance while share capital, retained earnings, and other reserves were used as independent variables. Data for the study was obtained from the audited annual reports of the 14 sampled deposit money banks for a period of 10 years covering 2009 to 2018. The study employed robust ordinary least square regression as a tool for analysis and testing of hypotheses based on the Hausman specification test. The result reveals that share capital has a positive and insignificant effect on return on assets while retained earnings and other reserves have a positive and significant effect on return on assets. The study concludes that retained earnings and other reserves improve the financial performance of listed deposit money banks in Nigeria, in line with pecking other theories. The study recommends, among others, that the board of directors should critically and closely monitor the financial structure decisions of the banks by closely ensuring that retained earnings and other reserves are ploughed back on profitable investments. |
