IMPACT OF CORPORATE GOVERNANCE ON BANKS MARKET VALUE IN NIGERIA
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IMPACT OF CORPORATE GOVERNANCE ON BANKS MARKET VALUE IN NIGERIA
STATEMENT OF THE PROBLEM
There is no denying that the current economy deserves a sound, stable, and better banking performance in light of the root causes, including unethical and unprofessional practises, poor management quality, and other factors that contributed to low bank performance and occasionally resulted in bank failure.
This has prompted numerous studies to consider the problem case; Fatimoh (2011) conducted a chi-square analysis of 200 distributed questionnaires and also performed a cross sectional data analysis using return on capital employed, current ratio, debt ratio, dividend cover, and retention ratio.
For a thirty-year span, Adegbami, Ofoegbu, and Fasanya (2011) conducted a pooled time-series OLS using corporate governance, inflation, interest rates, the broad money supply, and banks’ performance as factors.
The variables for the model used by Bubbico, Giorgino, and Monda (2012) in their cross-sectional econometric research included the corporate governance index, ownership concentration, ROA, sales growth, market capitalization index, and Tobin’s Q.
Akingunola, Adekunle, and Adedipe (2013) used the health, liquidity, and profitability of banks as variables for their model in an OLS econometric study on a time series data set spanning 35 years.
The researcher has chosen to accept the issues and establish a goal for resolving them in order to close the research gap in this course.
1.3 OBJECTIVES OF THE STUDY
This study’s main goal is to examine how corporate governance affects banks’ market values on the Nigerian Stock Exchange. The following additional precise goals are listed:
a. Analysing the impact of corporate board size on the market value of banks on the NSE.
b. Analysing the impact of the corporate board makeup on the market value of the banks on the NSE.
c. Analysing the impact of the number of audit meetings held each year on the market value of the banks on the NSE.
1.4.1 RESEARCH QUESTIONS
To aid in conducting this study, the following research questions were posed:
How much does corporate board sixe influence the market value of the bank on the Nigerian stock exchange?
How does a company’s board of directors’ makeup effect the market value of banks on the Nigerian stock exchange?
How much do the number of yearly audit meetings effect the market value of banks on the Nigerian stock exchange?
1.5 RESEARCH HYPOTHESES
The following theories were developed to aid in conducting this investigation.
Ho1: In Nigeria, the size of corporate boards has no bearing on banks’ market values.
Ho2: In Nigeria, the makeup of corporate boards has no bearing on banks’ market values.
Ho3: In Nigeria, the number of audit meetings held each year has little bearing on the market value of banks.
1.6 SCOPE OF THE STUDY
This study includes all Nigerian banks that conduct business on the Nigerian Stock Exchange (NSE) and employ corporate governance procedures. Twenty (20) years, or from 1995 to 2014, will be the number of years attribute for this scope.
1.7 SIGNIFICANCE OF THE STUDY
With reference to the effect of corporate governance on bank market value, this study will assist banks in maximising its advantages. This study will be extremely beneficial to all interested parties, such as shareholders, employees, investors, creditors, governments, etc.
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