Economics at your fingertips  

Determinants of Bank Performance in Nigeria: Do they Behave Differently with Risk-Adjusted Returns?

Sanni Mubaraq (), Salami Abdulai Agbaje () and Uthman Ahmad Bukola ()
Additional contact information
Sanni Mubaraq: Kwara State University,Malete, Nigeria
Salami Abdulai Agbaje: Al-Hikmah University,Ilorin-Nigeria
Uthman Ahmad Bukola: Al-Hikmah University,IlorinNigeria

Studia Universitatis „Vasile Goldis” Arad – Economics Series, 2020, vol. 30, issue 3, 1-34

Abstract: The failure of banks in Nigeria has hitherto become a recurring phenomenon. Worried by the syndrome, this paper examines the determinants of bank performance in Nigeria taking into cognizance the duality of financial measures of bank performance. From an analysis of 115 bank-year observations of a sample of 17 Nigerian deposit money banks and macroeconomic data for the period 2012-2018 using Arellano-Bover one-step system GMM estimation approach, differences in the explanatory potential of these factors between the models with risk-neutral and risk-adjusted measures of performance as dependent variables are empirically established. This suggests that there is a higher probability of investors, depositors and other stakeholders being indecisive when analyzing the performance of banks. However, relying on the assumptions of risk-return hypothesis and level of risk embedded in banks’ operations could warrant them opting for determinants of risk-adjusted returns in their decision making. This study is exceptional in the bank performance literature for its long list of measures and drivers of bank performance.

Keywords: risk-adjusted returns; risk-neutral returns; performance; bank; Nigeria (search for similar items in EconPapers)
JEL-codes: G21 G28 L25 M41 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link) (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Access Statistics for this article

Studia Universitatis „Vasile Goldis” Arad – Economics Series is currently edited by Florin Cornel Dumiter

More articles in Studia Universitatis „Vasile Goldis” Arad – Economics Series from Sciendo
Bibliographic data for series maintained by Peter Golla ().

Page updated 2020-09-19
Handle: RePEc:vrs:suvges:v:30:y:2020:i:3:p:1-34:n:1