Empirical Investigation of Corporate Board Characteristics and Deposit Money Banks (DMBS) Performance in Nigeria: 2008-2017

The study investigates empirically the corporate board characteristics and Deposit Money Banks
(DMBs) performance in Nigeria for the period 2008-2017. It is motivated by the lack of confidence by
investors in the capital market, the persistent agency problems, and the insolvency of large firms such
as banks. The general objective of this study is to investigate the impact of corporate board
characteristic on DMBs financial performance in Nigeria. Four research models/hypotheses were
formulated based on the literature reviewed. Also considered are the important factors affecting the
performance of DMBs in the Nigerian banking industry. This study investigated three of the listed
DMBs using a simple Judgmental Sampling Technique in a period of ten years each 2008 to 2017.
The population of the study is made up of all the 21 DMBs listed in the Nigerian Stock Exchange as at
2019. The data collected for the research were analyzed with econometric e-view. The panel data
was further analyzed using the random effect model. It was found that board skill shows a positive
and significant relationship with profit for the year, among others. The implication of the findings is that
each DMB studied was not adequately implementing the corporate governance practices, hence, the
reasons for the negative impacts of the independent variables except in the case of board
qualification. The study support that there is a relationship between corporate governance and firm
performance, but the relationship is only significant at the level of board qualification and profit for the
year. The negative relationship between board independence and DMBs performance (EPS) can be
attributed to the fact that the concept of board independence is a new phenomenon in developing
countries like Nigeria, and hence, it might take a few more years to have a significant impact on
financial performance. Hence, it was recommended that critical attention should be given to corporate
governance practices especially the CBN corporate governance codes for a better performance in the
Nigeria banking industry.