OWNERSHIP STRUCTURE AND FINANCIAL PERFORMANCE OF QUOTED DEPOSIT MONEY BANKS IN NIGERIA

Abstract

The financial performance of many organisations has been largely linked to their ownership structure over time, as it provides funding through owners’ equity. This study examines the effect of ownership structure proxied by foreign ownership and board ownership on the firm performance of deposit money banks quoted on the Nigerian Exchange Group from 2016-2025. Firm performance was represented by return on assets (ROA) while firm size was employed as a control variable. The study adopts an ex post facto research design, and the panel data were sourced from the various editions of the bank's financial statements for the 10 years. The Random Effect estimation technique was specified as the most appropriate model estimator after the Hausman specification test. The results of the Random Effect show that foreign ownership has a significant positive effect on financial performance, while director ownership has an insignificant positive effect on financial performance. The study recommends, among others, that the financial sector regulators should encourage the formation of banks with foreign ownership in order for the foreign owners to bring in their expert knowledge and resources into the economy, as banks with foreign control usually have better performance.