FIRM ATTRIBUTES AND CAPITAL STRUCTURE DECISIONS: AN EMPIRICAL ANALYSIS OF LISTED BANKS IN NIGERIA
Umar Sunusi , Muhammad Surajo Abdulwahab , Jamilu Madaki and Umar Salim Ibrahim
Volume 13 Issue 2
Abstract
This study examines the effect of bank specific attributes on the capital structure of listed deposit money banks (DMBs) in Nigeria. Using panel data from 12 banks listed on the Nigerian Exchange Group (NGX) over the period 2012 to 2023. The study employs Fixed Effects and Random Effects regression models, with the Hausman specification test guiding estimator selection. Five bank attributes are examined: bank size, profitability, asset tangibility, liquidity, and growth opportunities, while the total debt ratio was proxied by capital structure. Results show that bank size and asset tangibility have a positive and significant effect on leverage, consistent with Trade-off Theory. Profitability and liquidity negatively and significantly influence leverage, supporting the Pecking Order Theory. Growth opportunities are positive but statistically insignificant. Bank specific financial characteristics actively shape financing choices, and understanding these dynamics is essential for both macro-prudential oversight and firm-level financial management. Keywords: Capital Structure, Bank Attributes, Panel Data, Nigeria, Leverage
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