Publisher: Centre For Social Science Research, Enugu

Corporate Governance and The Nigerian Banking Sector’S Share Price

Matthew Adeolu Abata, Phd, Omokehinde, Joshua Odutola, Phd, Olakunle Tijaniolakunle Tijaniv
KEYWORDS: Corporate Governance, Share Price Performance, Banking Sector, Regulatory bodies, Return on Asset.

ABSTRACT:

Different corporate governance reforms have emerged from Nigerian corporate regulatory bodies to spur Nigerian banks into adopting sound corporate governance practices in the salutary interest of the Nigerian banking sector. This study therefore investigates the extent to which the corporate
governance metrics impact on the share price performance of Nigerian banks. The control variables of firm performance and growth were also employed, as these are key determinants of share price performance. Explanatory research design was employed to expound the links between
the dependent and independent variables. Secondary data were gathered from the annual reports of these banks from 2007 to 2014 to test five formulated hypotheses. Among other things, the study found that the coefficients of Audit Committee Size, Growth and Firm performance (surrogated by
ROA) were significantly negatively related to share price performance, while the other variables are positively related to share price performance. It was concluded that corporate governance metrics, together with the controls variables are determinants of share price performance of
Nigerian listed banks. It is therefore recommended that corporate governance manuals should be circulated to bank employees to ensure enforcement of consistent compliance in every transaction. Equally, bank regulatory bodies such as CBN, SEC, NSE, should sustain reform efforts that will
employ the best corporate governance practices that will enhance international competitiveness



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