CHAPTER ONE
1.1
1.2 STATEMENT OF THE PROBLEM
Every investment decision taken by the manager affects the performance of the banks. What percentage of the capital should be debt and what percentage should be equity so as to maximize profitability of the bank given that each source of finance has a cost-benefit attach to it, is a major managerial decision. The difficulties associated with designing an optimum capital structure policies to enhance profitability is the reason why this study sought to examine whether capital structure affect banks’ performance concentrating on five (5) selected banks, First Bank, Sterling Bank, Guarantee Trust Bank, United Bank for Africa and Access Bank. The study, therefore, attempts to address the capital structure puzzle using data from the Nigerian quoted banks.
1.3 OBJECTIVES OF THE STUDY
The main objective of this study is to examine the relationship between capital structure and financial performance of Nigerian banks. Accordingly this study clusters around two specific objectives:
1.4 RESEARCH QUESTION
For this research work, the following questions would serve as a guide identifying the effect of capital structure on banks performance:
1. To what extent is the profitability of Nigeria banks influenced by total debt?
2 To what extent is the profitability of Nigerian banks influenced by equity.
1.5 RESEARCH HYPOTHESES
The hypotheses to be tested in order to provide answers to the questions stated in 1.4 above are stated in null form as follows:
Ho: The Profitability of Nigerian banks is not significantly influenced by total debt ratio.
Hi: The Profitability of Nigerian banks is significantly influenced by total debt ratio.
Ho: The Profitability of Nigerian banks is not significantly influenced by equity.
Hi: The Profitability of Nigerian banks is significantly influenced by equity.
1.6 SCOPE OF THE STUDY.
This study focuses on the effect of capital structure on banks, performance. The study covers a period of five (5) years spanning from 2009 to 2013.
This study is also restricted to banks listed on the Nigerian stock exchange (NSE) as at the end of December 2014 for availability of data and to enhance meaningful comparison.
1.7 SIGNIFICANCE OF THE STUDY
This study is significant in many respects. Firstly, it seeks to add to the existing literature on the effect of capital structure on banks’ performance in the context of an emerging global market.
Secondly, the study will be useful to managers who will use the findings of this research investigation as a guide in financial decision making.
The study is expected to provide evidence that would serve as important quantitative information into the caldron of policies from an emerging economy.
1.8. LIMITATIONS OF THE STUDY
Olannye (2006) maintains that limitations are those constraints facing the researchers which by nature of the research situation itself may limit the researchers in making generalization. Specifically, limitations are those factors inherent in the research situation that might affect the result which the investigation must acknowledge and recognize.
Every research investigation focuses one limitation or the other. Accordingly, this research project is not immune to that. Some of these limitations are financial, materials, physical and otherwise. The study envisaged is carried on, but not without the following limitations.
1.9. DEFINITION OF MAJOR TERMS
NOT THE TOPIC YOU ARE LOOKING FOR?
Once payment is made, kindly send us your project topic, email address and payment name to +234 810 144 4147
Once payment is confirmed, Project materials will be sent to your email
Importation is important for the development and growth of national economies because not all countries have the resources and skills required to produce certain goods and services thus there is need for them to import products which they deem fit is...
This study will be helpful in the academic field as it would be an addition to the issue of covid-19 and its effects on unemployment.
This study will be helpful to Lagos state Government and governments of other states in Nigeria in creating awareness of the effects of overpopulation and on how to diffuse the population properly.
This study will examine the effect of corruption in government agency on the economic growth and development of Nigeria.
This study will be helpful to organizations in creating awareness on the effects of relying only on corp members on other unemployed youths.
This study is of significance to the government as it will serve as a guide in implementing effective measures to curtail crimes and insecurity as it find means of solving the motorcycle and tricycle ban.
This study is significant as it provides an opportunity to hear Nigerian women's perspectives on their access (or lack thereof) to education and the hurdles that prevent them from participating in it.
This topic is critical to assisting policymakers in making decisions about how to allocate public funds. Future academics will be able to use these findings to learn more about the relationship between government agriculture spending and economic gro...
The government of Nigeria, students, and the general public will benefit from this study. Nigeria's ability to relieve poverty is contingent on adequate inflows of foreign investment funds and a secure investment environment.
This study it gives actual information on the current condition of government spending management and accountability.
Message Us on WhatsApp »
