EFFECT OF CORPORATE GOVERNANCE MECHANISMS ON FINANCIAL PERFORMANCE OF LISTED DEPOSIT MONEY BANKS IN NIGERIA

Abstract

An examination of the effect of corporate governance chararacteristics on financial performance of listed firms has been a long standing issue and previous results remain controversial because of the mixed results that were found. Consequently, this study assessed the effect of corporate governance mechanism on financial performance of listed deposit money banks in Nigeria. The study had a population of fourteen (14) listed deposit money banks and a sample size of fourteen (14) banks was arrived at using census sampling technique. Secondary method of data collection was used in gathering data through annual reports and accounts of the sampled banks. Data collected was analysed using multiple regression technique. The findings revealed that board size and board composition have negative and significant effect on profitability of listed deposit money banks in Nigeria while audit committee meeting and presence of remuneration committee had a positive and significant effect on profitability of listed deposit money banks in Nigeria. The study recommended inter alia that management of listed deposit money banks should be retaining a small number of board size and that there should be audit committee and remuneration committee in place to enhance their profitability.