RELATIONSHIP BETWEEN BOARD CHARACTERISTICS AND PROFITABILITY AMONG DEPOSIT MONEY BANKS IN NIGERIA

Abstract

This study examines the relationship between board characteristics and profitability of Deposit Money Banks in Nigeria. Data used for the research are secondary and are generated from the Corporate Governance Section of Nigeria Deposit Insurance Corporation (NDIC) Reports. Profitability which is the Dependent Variable is proxied by Return on Asset (ROA); while Board Size, Board Independence, Gender Diversity and Board Meeting are Independent Variables. This study used panel data analysis to analyze the data collected for this work with findings that Board Size and Gender Diversity have negative relationship with Return on Asset and that Board Independence and Board Meetings have positive relationship with Return on Asset. The goodness of fit of the model affirmed the relationship between Board Characteristics and profitability to be significant. Therefore, this study recommends that Deposit Money Banks should further strengthen the independence of their boards and take their board meetings as a matter of importance since they have positive relationship with their profitability.