Impact of Selected Corporate Governance Indicators on Capital Adequacy and Liquidity in Nigerian Deposit Money Banks
Ayotunde Qudus Saka,
Ifeoma Patricia Osamor
Issue:
Volume 10, Issue 6, November 2022
Pages:
238-243
Received:
10 October 2022
Accepted:
4 November 2022
Published:
11 November 2022
DOI:
10.11648/j.jfa.20221006.11
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Views:
Abstract: Purpose: The recent corporate scandals and events across the world redirected the thinking of regulators around the world towards enacting more robust rules to ensure transparency, adequate disclosure, and accountability in the corporate regulation. The banking sector is critical to the economic development of any nation, therefore, apex regulatory bodies (Central Banks) in various countries regulate the activities of banks to prevent a systemic collapse to assure financial stability. This study investigates the impact of corporate governance indicators on capital adequacy and liquidity of selected Deposit Money Banks in Nigeria. Methodology/Design/Approach: The study adopts a quantitative research approach in which data were collected from publicly available secondary sources between 2009 and 2018 for 12 banks using judgmental sampling techniques out of 21 Deposit Money Banks as of 2018 to represent the Nigeria Banking sector, Pooled OLS, Random effect model were estimated by random-effect GLS regression and fixed effect models were used to analyze the impact of corporate governance indicators selected on capital adequacy and liquidity Nigerian DMBs. Originality/Value: The body of knowledge in the areas of corporate financial management, finance and accounting, as well as bank performance and corporate governance, particularly in Sub-Saharan African nations, will be enriched by this research.
Abstract: Purpose: The recent corporate scandals and events across the world redirected the thinking of regulators around the world towards enacting more robust rules to ensure transparency, adequate disclosure, and accountability in the corporate regulation. The banking sector is critical to the economic development of any nation, therefore, apex regulatory...
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The Effect of Internal Control Systems on the Financial Performance of Commercial Banks in Rwanda
Issue:
Volume 10, Issue 6, November 2022
Pages:
244-252
Received:
9 April 2022
Accepted:
27 May 2022
Published:
22 November 2022
DOI:
10.11648/j.jfa.20221006.12
Downloads:
Views:
Abstract: Internal control systems play an important role in any organization as they help achieve financial performance goals. Internal controls minimize risk, protect assets, ensure record accuracy, increase operational efficiency, and facilitate compliance with policies, rules, regulations, and laws. The main purpose of the study was to investigate the impact of the internal control system on the financial performance of commercial banks in Rwanda. The study was guided by the following goals and purposes; to investigate the relationship between the internal control environment on the Financial Performance of Commercial Banks in Rwanda and to establish the effect of risk management on the Financial Performance of Commercial Banks in Rwanda. Most commercial banks in Rwanda have been poorly performing in recent years due to weak internal control systems, records management, financial reporting, and regulatory compliance. In this study, we adopted a system theory and agency theory. The study adopted a descriptive research design using both quantitative and qualitative approaches. The study adopted a target population of 96 and multi-level random sampling of 38 Senior Managers in various categories. Survey data was collected using a structured questionnaire. The data obtained were analyzed using both qualitative and quantitative analysis. Multiple regression models were used to test whether the internal control environment and risk management have an influence on the Financial Performance of Commercial Banks in Rwanda. It was found that an internal control system had a significant relationship with Financial Performance. Based on the research findings, it can be concluded that an internal control system is a significant positive predictor of Financial Performance. The results of the study suggest that internal control systems, especially risk management and control environment, are important areas where commercial banks should pay close attention to improving Rwanda's financial performance. The results are valuable to commercial bank investors and are expected to provide the basis for improving the financial performance of commercial banks. Management also needs to ensure that the organization has a strong internal control environment in which internal control activities properly inform policies and procedures. Managers need to maximize the economic benefits of internal control by using corporate risk management and good corporate governance.
Abstract: Internal control systems play an important role in any organization as they help achieve financial performance goals. Internal controls minimize risk, protect assets, ensure record accuracy, increase operational efficiency, and facilitate compliance with policies, rules, regulations, and laws. The main purpose of the study was to investigate the im...
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