Combined effects of capital structure and corporate governance on financial stability of deposit money banks
Combined effects of capital structure and corporate governance on financial stability of deposit money banks

Summary/Abstract: Research background: Liquidity crisis and liquidation of deposit money bank over the past years has been connected to poor corporate governance and in appropriate blend of capital structure. Purpose of the article: By using different sample data, extensive research has investigated how corporate governance and capital structure independently influences bank’s profitability, but studies investigating the joint impact of corporate governance and capital structure on the stability of deposit money bank in Nigeria is close to non-existence. This research work seeks to analyse the joint impacts of corporate governance (CG) and capital structure (CS) on stability of deposit money bank in Nigerian from 2010 to 2021. Methods: A panel regression approach was used and expost facto research design was employed in this study to examined the impacts of corporate governance and capital structure on Bank stability. Findings & Value added: Result showed a positive and substantial influence of capital structure proxied by Total Debt to Total Asset ratio and Long-Term Debt to equity ratio and corporate governance variables (Board independence, Credit Committee) on financial stability proxied with Liquidity ratio among carefully chosen deposit money banks in Nigeria. The research work affords scholars, academicians, banks administration, and deposit money banks supervisory bodies a fresh understanding of how capital structure and corporate governance enhanced banks’ financial stability via bank liquidity by designing sound governance and capital mixture policies.

• Details
• Contents