A Comparative Analysis of Nigerian Deposit Money Banks’ Performance Pre and Post-Adoption of IFRS 9

Amos Adejare Aderibigbe, Tunji Trimisiu Siyanbola and Ibukun Olalekan Fadairo
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Amos Adejare Aderibigbe: Department of Accounting, Crescent University, Abeokuta, Nigeria
Tunji Trimisiu Siyanbola: Department of Accounting, Crescent University, Abeokuta, Nigeria
Ibukun Olalekan Fadairo: Federal University of Agriculture, Abeokuta, Nigeria

International Journal of Research and Innovation in Social Science, 2024, vol. 8, issue 9, 1676-1687

Abstract: Implementing IFRS 9 in Nigeria brought with it both opportunities and challenges to the banking industry which require a thorough analysis. A lot of questions remain unanswered on how the implementation of IFRS 9 impacts banks’ bottom lines. This study aimed to assess how the adoption of IFRS 9 has affected the financial performance of Nigerian deposit money banks. The impact of the introduction of IFRS 9 on the performance of the DMBs in Nigeria was investigated by analyzing financial performance metrics, including return on assets (ROA) and return on equity (ROE). The study used Access Bank Limited (ACL), Guaranty Trust Bank Limited (GTB), United Bank for Africa Limited (UBA), and Zenith Bank Plc (ZB) as a case study. A paired sample t-test was used to analyze the data from the banks’ financial reports for the five years before and after the adoption of the standard. The results implied that different banks saw different effects from the implementation of IFRS 9. Stability was shown by ABL while UBA showed a significant rise in both ROA and ROE, demonstrating successful planning and transition tactics. Major changes occurred at GTB and ZB, highlighting the significance of strategic financial planning and strong risk management frameworks in sailing through the challenges brought about by IFRS 9. According to the findings, Nigerian DMBs’ ROA and ROE are significantly impacted by the standard’s implementation. The study recommends that banks should maintain a proactive approach to monitor and adjust their financial strategies and operations accordingly given the ongoing evolution of accounting standards and regulatory requirements.

Date: 2024
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