Abstract
The study investigated the effect of net interest margin on financial performance of deposit money banks in Nigeria. The researcher developed four specific objectives, four research questions and four hypotheses that guided the study. The research design employed was ex post facto. This design is selected and implemented due to the researcher's lack of control over the various elements of the design. The data for this study is preexisting, therefore it is utilized for a secondary data analysis. The study's population comprised twenty-two (22) designated deposit money banks in Nigeria. This study employed the judgmental sampling technique. The sample size is made up of two (2) DMBs which includes United Bank for Africa Plc, Fidelity. The data for this study were obtained from the published financial statements of the chosen publicly traded deposit money banks in Nigeria. This study employed an estimated technique that involved the use of descriptive statistics and Ordinary Least Squares (OLS) regression analysis. The E-view-9 software was utilized to carry out the analysis. The study established that net interest margin is statistically significant and has a positive effect on operating income (OI). The researchers suggested that Banks should monitor and manage the duration gap between assets and liabilities, considering potential interest rate changes and the bank's risk appetite. Banks should explore opportunities to diversify income sources by offering a broader range of financial products and services, such as wealth management, insurance, and asset management.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have