Earnings and bank profitability in Nigeria

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John N. N. Ugoani


Bank earnings in form of retained profit help in the capital formation of banks. This is critical because capital inadequacy is often a cause of bank failures. During the banking crisis in Nigeria the gross earnings of many banks diminished considerably due to frauds and bad management. For example, in 2009 the Central Bank of Nigeria revoked the operating licences of fourteen banks which had huge nonperforming loans and were making losses. The fragility in the Nigerian banking system in the 1990s and beyond was compounded due to wide spread poor corporate governance practices and imprudent lending that led to the erosion of gross earnings and profitability. The study employed the exploratory research design. Data analyses were done through description statistics and the regression technique using the statistical package for the social sciences. The regression result was Y = 4.926 + 1.877x meaning that with an increase of 1 percent in gross earnings bank profitability increases by 1.88 percent. This is the crux of the study.


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Author Biography

John N. N. Ugoani, College of Management and Social Sciences, Rhema University

John N. N. Ugoani, holds a PhD degree in management. He is a senior lecturer and coordinator College of Management and Social Sciences at Rhema University Aba, Nigeria, and teaches courses on business, management, production management, human resource management, industrial relations, psychology and industrial psychology. John has over scholarly publications with over 1000 full text readership downloads and 5000 abstract views worldwide. He is listed among Ten Top Authors by Social Science Research Network. His present research interests are in the areas of emotional intelligence, managerial psychology, global human resource management, bank management, conflict management, governance, knowledge management, leadership, entrepreneurship, diversity, public policy, among others. Before entering academia, he was a senior manager at First Bank until 2009.


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