DIVIDEND POLICY AND SHARE PRICE VOLATILITY: EVIDENCE FROM LISTED DEPOSIT MONEY BANKS IN NIGERIA

Authors

  • Isiaka Olalekan Lasisi Air Force Institute of Technology, Nigeria Air Force Base, Kaduna
  • James George Apochi Air Force Institute of Technology, Nigeria Airforce Base, Kaduna
  • Asma’u Mahmood Baffa Air Force Institute of Technology, Nigeria Air Force Base, Kaduna
  • Kabiru Badawiyu Air Force Institute of Technology, Nigeria Air Force Base, Kaduna

DOI:

https://doi.org/10.57233/gujaf.v1i2.33

Keywords:

Dividend per Share, Earnings per Share, Share Price Volatility, Banks, Nigeria

Abstract

This study examines the impact of dividend policy on share price volatility of listed deposit money banks in Nigeria. Data for the study were extracted from the annual reports and accounts of twelve (12) deposit money banks in Nigeria from 2014-2018. The study uses share price volatility as dependent variable and dividend per share, earnings per share and bank size as explanatory variables. Descriptive analysis, correlation analysis and regression model were used to perform the data analysis. Random effect regression analysis was utilized to confirm the empirical finding of the study. The results show that dividend per share and earnings per share have a positive and significant impact on share price volatility of listed deposit money banks in Nigeria. The finding of the study revealed that dividends were relevant to investors, indicating that the signaling theory was relevant, and investors believed in information being transferred in the dividend policy decision. The study recommends that the board and management of banks should ensure that good dividend policy is put in place and earnings per share policies are maintained because it has been empirically proven to improve share price movement.

Author Biographies

Isiaka Olalekan Lasisi, Air Force Institute of Technology, Nigeria Air Force Base, Kaduna

Department of Accounting,
Air Force Institute of Technology,
Nigeria Air Force Base, Kaduna

James George Apochi, Air Force Institute of Technology, Nigeria Airforce Base, Kaduna

Bursary Department,
Air Force Institute of Technology,
Nigeria Airforce Base, Kaduna

Asma’u Mahmood Baffa, Air Force Institute of Technology, Nigeria Air Force Base, Kaduna

Department of Accounting,
Air Force Institute of Technology,
Nigeria Air Force Base, Kaduna

Kabiru Badawiyu, Air Force Institute of Technology, Nigeria Air Force Base, Kaduna

Department of Banking and Finance,
Air Force Institute of Technology,
Nigeria Air Force Base, Kaduna

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Published

2020-10-20

How to Cite

Olalekan Lasisi, I., George Apochi, J., Mahmood Baffa, A. ., & Badawiyu, K. (2020). DIVIDEND POLICY AND SHARE PRICE VOLATILITY: EVIDENCE FROM LISTED DEPOSIT MONEY BANKS IN NIGERIA . Gusau Journal of Accounting and Finance, 1(2), 16. https://doi.org/10.57233/gujaf.v1i2.33