Capital Structure and Financial Performance of Commercial Banks in Nigeria

Aliyu Ahmed Alhaji

Capital Structure and Financial Performance of Commercial Banks in Nigeria

Aliyu Ahmed Alhaji * §

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Department of Finance , University of Ilorin, 1 Univ...

Capital Structure and Financial Performance of Commercial Banks in Nigeria

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Abstract

Capital Structure is an important concept in business which have accounted for financial performance of businesses in literature. Thus, this study was conducted to examine the relationship between capital structure and financial performance of commercial banks in Nigeria for the period of (2010 to 2019). Five (5) commercial banks were selected using Judgmental sampling technique. Data were collected from financial statements of selected banks. The data was analyzed using E-View 2010. Unit root test, Granger causality test and panel regression Analysis was conducted in this study. We concluded that, capital structure variables used are good predictor and significant with financial performance of commercial banks in Nigeria. In addition, we concluded that, Debt to Equity Ratio, Total Debts and Total Equity over the period under study, do not contributed to the financial performance (Return on Assets) of commercial banks in Nigeria. Furthermore, Equity to Capital Ratio and Debts to Capital Ratios improves the financial performance(Return on Assets) of commercial banks over the years. We therefore, recommended that, the bank managers should ensure that, capitals are spent on productive assets in other to improve financial performance of the banks, among others.

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Funding

No external funding was declared for this work.

Conflict of Interest

The authors declare no conflict of interest.

Ethical Approval

No ethics committee approval was required for this article type.

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Not applicable for this article.

How to Cite This Article

Aliyu Alhaji. 2026. "Capital Structure and Financial Performance of Commercial Banks in Nigeria". Global Journal of Management and Business Research, Global Journal of Management and Business Research - C: Finance GJMBR-C Volume 22 (GJMBR Volume 22 Issue C1).

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GJMBR Volume 22 Issue C1

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Journal Specifications

Crossref Journal DOI 10.17406/GJMBR

Print ISSN 0975-5853

e-ISSN 2249-4588

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Classification

GJMBR-C Classification JEL Code: G01

Submission ReceivedAugust 29, 2021
Peer Review Double Blind
Handling Editor
Accepted September 23, 2021
Published October 7, 2021

Version of record

v1.2

Issue date

February 18, 2022

Language

English

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