INTEREST INCOME AND DEPOSIT MONEY BANKS (DMBs) PERFORMANCE IN NIGERIA
The role of deposit money banks (DMBs) as a critical component of the financial intermediary component of the financial systems for the benefit of their shareholders and the economy at large has become more pronounced in recent times. Banks help link both the surplus spending unit and the deficit s...
Saved in:
| Main Authors: | , , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
Faculty of Economics, University of Tuzla
2019-11-01
|
| Series: | Economic Review |
| Subjects: | |
| Online Access: | http://er.ef.untz.ba/index.php/er/article/view/73 |
| Tags: |
Add Tag
No Tags, Be the first to tag this record!
|
| _version_ | 1823861278673731584 |
|---|---|
| author | Russell Olukayode Christopher Somoye Bamidele M. Ilo Lateef Adewale Yunusa |
| author_facet | Russell Olukayode Christopher Somoye Bamidele M. Ilo Lateef Adewale Yunusa |
| author_sort | Russell Olukayode Christopher Somoye |
| collection | DOAJ |
| description |
The role of deposit money banks (DMBs) as a critical component of the financial intermediary component of the financial systems for the benefit of their shareholders and the economy at large has become more pronounced in recent times. Banks help link both the surplus spending unit and the deficit spending unit for a fee which is interest income. Interest income is generated from the traditional activities of banks as a reward for their intermediation. This study thus, examined the impact of interest income on the performance of DMBs in Nigeria. The study employed data from the annual reports and accounts covering the period 2012-2017 of fifteen (15) selected interest charging DMBs out of the twenty-one (21) listed banks on the Nigerian Stock Exchange as on 31st December, 2018. The results obtained from the random effect model indicate that interest income and capital adequacy contribute and significantly drive the profitability of the Nigerian DMBs. The study therefore recommends that DMBs should maintain an adequate level of capital and a stable interest income through effective management of loans and advances in order to increase the income generated from lending and consequently improve their profitability for the benefit of their shareholders.
|
| format | Article |
| id | doaj-art-ae3e1d22f07f4f208669ac91ffae59ac |
| institution | Kabale University |
| issn | 1512-8962 2303-680X |
| language | English |
| publishDate | 2019-11-01 |
| publisher | Faculty of Economics, University of Tuzla |
| record_format | Article |
| series | Economic Review |
| spelling | doaj-art-ae3e1d22f07f4f208669ac91ffae59ac2025-02-10T00:30:59ZengFaculty of Economics, University of TuzlaEconomic Review1512-89622303-680X2019-11-01172INTEREST INCOME AND DEPOSIT MONEY BANKS (DMBs) PERFORMANCE IN NIGERIARussell Olukayode Christopher Somoye0Bamidele M. Ilo1Lateef Adewale Yunusa2Department of Banking and Finance, Olabisi Onabanjo University, Ago-Iwoye, NigeriaDepartment of Banking and Finance, Olabisi Onabanjo University, Ago-Iwoye, NigeriaDepartment of Banking and Finance, Olabisi Onabanjo University, Ago-Iwoye, Nigeria The role of deposit money banks (DMBs) as a critical component of the financial intermediary component of the financial systems for the benefit of their shareholders and the economy at large has become more pronounced in recent times. Banks help link both the surplus spending unit and the deficit spending unit for a fee which is interest income. Interest income is generated from the traditional activities of banks as a reward for their intermediation. This study thus, examined the impact of interest income on the performance of DMBs in Nigeria. The study employed data from the annual reports and accounts covering the period 2012-2017 of fifteen (15) selected interest charging DMBs out of the twenty-one (21) listed banks on the Nigerian Stock Exchange as on 31st December, 2018. The results obtained from the random effect model indicate that interest income and capital adequacy contribute and significantly drive the profitability of the Nigerian DMBs. The study therefore recommends that DMBs should maintain an adequate level of capital and a stable interest income through effective management of loans and advances in order to increase the income generated from lending and consequently improve their profitability for the benefit of their shareholders. http://er.ef.untz.ba/index.php/er/article/view/73bank performancedeposit money banksinterest incomereturn on assetloans and advances |
| spellingShingle | Russell Olukayode Christopher Somoye Bamidele M. Ilo Lateef Adewale Yunusa INTEREST INCOME AND DEPOSIT MONEY BANKS (DMBs) PERFORMANCE IN NIGERIA Economic Review bank performance deposit money banks interest income return on asset loans and advances |
| title | INTEREST INCOME AND DEPOSIT MONEY BANKS (DMBs) PERFORMANCE IN NIGERIA |
| title_full | INTEREST INCOME AND DEPOSIT MONEY BANKS (DMBs) PERFORMANCE IN NIGERIA |
| title_fullStr | INTEREST INCOME AND DEPOSIT MONEY BANKS (DMBs) PERFORMANCE IN NIGERIA |
| title_full_unstemmed | INTEREST INCOME AND DEPOSIT MONEY BANKS (DMBs) PERFORMANCE IN NIGERIA |
| title_short | INTEREST INCOME AND DEPOSIT MONEY BANKS (DMBs) PERFORMANCE IN NIGERIA |
| title_sort | interest income and deposit money banks dmbs performance in nigeria |
| topic | bank performance deposit money banks interest income return on asset loans and advances |
| url | http://er.ef.untz.ba/index.php/er/article/view/73 |
| work_keys_str_mv | AT russellolukayodechristophersomoye interestincomeanddepositmoneybanksdmbsperformanceinnigeria AT bamidelemilo interestincomeanddepositmoneybanksdmbsperformanceinnigeria AT lateefadewaleyunusa interestincomeanddepositmoneybanksdmbsperformanceinnigeria |