Aza Ibrahim Eyigege and Nguavese MN
Deposit money banks in Nigeria do render lending services to their customers in form of short, medium or long term basis especially from customer deposit taking. Individuals, business organizations as well as government do receive loans and advances to enable them invest, develop and contribute towards the development of a country. This research work investigates the influence of bank lending on financial performance of deposit money banks quoted on the Nigeria stock exchange. The study adopt a descriptive research design using a cross-sectional panel data of 12 years to examine the influence of bank lending proxied as (loans and advances to total deposit) on financial performance using profitability and liquidity as dependent variables proxied as ROA and CA/CL respectively. The study utilizes a sample of selected five deposit money banks out of the population of 21 with the use of Yemane’s sampling technique. The study adopts panel data OLS regression and fixed effect regression analysis. The finding of the study indicates insignificantly positive influence of bank lending on financial performance of deposit money banks quoted on the Nigeria stock exchange. The study therefore recommends that deposit money banks in Nigeria should mobilize more deposits in order to enhance their lending capability and should formulate comprehensive and realistic financial plans to boost financial performance.
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