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Risk and Profitability Considerations in Off-Balance Sheet Engagements: A Comparative Analysis of Deposit Money Banks in Nigeria

Achugamonu, Bede U. and Osunkoya, Michael and Aiyepeku, Dochearty Ayo and Adetiloye, K. A. and Akinjare, Victoria Abosede (2016) Risk and Profitability Considerations in Off-Balance Sheet Engagements: A Comparative Analysis of Deposit Money Banks in Nigeria. In: Vision 2020: Innovation Management, Development Sustainability, and Competitive Economic Growth, 9-10 November 2016, Seville, Spain.

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Abstract

This study investigated how off balance sheet engagements of deposit money banks affect risk and profitability compositions of such banks. The study employed secondary data obtained from financial statements of five deposit money banks (namely, Access, Zenith, UBA, GTB and First Bank) for eleven years period (2004 to 2014). The descriptive and content analysis of the financial statements of the selected banks investigated revealed that Zenith Bank has the highest amount of off balance sheet engagement. It therefore concludes that inspite of the huge profit that may accrue to the deposit money bank for engaging in off balance sheet activities, it may be exposed to a very high risk if the unexpected happens. In view of this, this study recommends a prudent management and monitoring of off balance sheet activities by management, the board and Central Bank of Nigeria. This is necessary to ensure that banks remain within the approved threshold or limits of off balance engagements inorder not to compromise the confidence reposed on the banks by depositors and investors.

Item Type: Conference or Workshop Item (Paper)
Uncontrolled Keywords: Off balance sheet engagement, profitability, risk, assets and liabilities
Subjects: H Social Sciences > H Social Sciences (General)
Divisions: Faculty of Law, Arts and Social Sciences > School of Social Sciences
Depositing User: Mrs Patricia Nwokealisi
Date Deposited: 19 Jun 2017 09:30
Last Modified: 19 Jun 2017 09:30
URI: http://eprints.covenantuniversity.edu.ng/id/eprint/8354

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