EARNINGS MANAGEMENTAND DIVIDEND POLICY OF LISTED COMMERCIAL BANKS IN NIGERIA

Abstract

The aim of this study is to examine the association between dividend policy and earnings management of listed commercial banks in Nigeria. The study adopted ex-post-facto research design and stratified random sampling technique to select all commercial banks quoted on the Nigerian Exchange Group that span from 2013 to 2022 financial years. Secondary data were extracted from the annual reports of the commercial banks in Nigeria. The collected data were analyzed using descriptive statistics, correlation analysis, and multivariate regressions analysis. The results revealed that, earnings per share have a coefficient value of -0.03 and probability value of 0.006 indicating that Earnings per share has inverse significant effect on accrual earnings management at 1% level and a coefficient value of -0.007 and p- value of 0.025 indicating a corresponding inverse significant effect on real earnings management of the commercial banks in Nigeria. Again Price earnings ratio has coefficient value of-0.008 and p- value of 0.114 indicating an inverse significant effect on accrual earnings management but has coefficient value of 0.003 and p-value of 0.219 indicating a positive significant effect on real earnings management. Also dividend yield has coefficient value of 0.018 and p-value 0f 0.001 indicating that dividend yield has statistical significant effect on both accrual earnings and real earnings management of the commercial banks studied. The study recommends amongst others that commercial banks should   engage the chief executive officers that are goal getters to enhance the operating profitability of the banks, which would play down on the quest to make up their deficiencies through earnings manipulations. Pertinently, the commercial banks are also encouraged to ensure regular payment of dividend to shareholders which will motivates other investors rather than opportunistic behaviors and manipulations through earnings management.
 Keywords: Earnings Management, Dividend Policy, Commercial Banks, Nigeria.