Corporate Governance and Financial Performance of Deposit Money Banks.

Banking sector plays a pivotal role in the development of any economy. However, in recent years, persistent financial underperformance among Deposit Money Banks (DMBs) in Nigeria has raised critical concerns about the adequacy of their corporate governance structures. Despite regulatory frameworks and governance codes designed to ensure transparency, accountability, and stakeholder protection, weaknesses persist in key areas, including board composition, meeting frequency, audit committee, and Board structure. These issues might have contributed to declining financial indicators within the banking sector. Consequently, this study investigates the impact of corporate governance mechanisms on the financial performance of listed deposit money banks (DMBs) in Nigeria. The study adopts an ex post facto research design using secondary data extracted from the audited annual reports of ten selected DMBs listed on the Nigerian Exchange over ten years (2015-2024). Descriptive statistics and random effects panel regression techniques were employed in analysing the data. The findings revealed that board diversity has a positive and statistically significant effect on financial performance, highlighting the importance of gender inclusivity and diverse board composition in enhancing strategic decision-making. Conversely, both the audit committee and frequency of board meetings exhibit negative but statistically insignificant relationships with EPS, suggesting that these governance structures may lack the functional depth needed to influence financial outcomes meaningfully. Board structure showed a positive, yet statistically insignificant, relationship. The study concludes that while not all governance mechanisms significantly impact performance, diversity in board composition plays a critical role in enhancing bank profitability. It recommends strengthening inclusive governance policies and improving the functional effectiveness of governance committees to boost stakeholder value in Nigeria's banking sector.