Effects of Bank Specific Variables on Profitability of Listed Deposit Money Banks in Nigeria

Abstract: The study examines the Effect of Bank Specific Variables on the Profitability of listed deposit money banks in Nigeria during the period 2014-2024. Proxies used to measure bank specific variables are bank size and liquidity ratio, while profitability (ROA) was the dependent variable. Panel data was used to analyse the data sourced from the individual financial reports of the listed deposit money banks in Nigeria. The sample adopted ten (10) listed deposit money banks out of the fifteen (15) deposit money banks traded in the Nigerian exchange group (NGX). The study employed panel regression model to estimate the key relationship between bank specific variables and profitability. The result showed that bank size has insignificant effect on profitability of listed deposit money banks in Nigeria, while liquidity has significant effect on profitability of listed deposit money banks in Nigeria. The study recommended that considering the fact that bank size has no significant effect on profitability of listed deposit money banks in Nigeria, managers of deposit money banks should concentrate on providing quality service to their customers instead of embarking on expansion which has no effect on earnings. The study also recommended that managers of deposit money banks should manage their liquid asset efficiently, in order to meet up their day to day financial obligations which will increase profitability.

Bank specific variables, Bank size, Liquidity Ratio, Profitability, Listed Deposit Money Banks

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