INTELLECTUAL CAPITAL AND FINANCIAL PERFORMANCE OF DEPOSIT MONEY BANKS IN NIGERIA

Abstract

Intellectual capital is perceived to be a wealth creator and promoter of financial performance
hence building sustainable growth and development. This study empirically investigated the effect
of intellectual capital using capital employed efficiency, relational capital efficiency and structural
capital efficiency on financial performance of deposit money banks in Nigeria for the period 2004
to 2018. The study utilized secondary data obtained from the annual reports and ex post facto and
correlational research designs. The data obtained were analysed using descriptive statistics,
diagnostic tests, augmented dickey fuller test and multiple regression analysis. The result revealed
that capital employed efficiency, human capital efficiency, structural capital efficiency, bank size
and bank age showed a positive and significant association with tobin-q of sampled deposit money
banks in Nigeria. On the basis of the findings, the paper therefore concluded that intellectual
capital influences the financial performance of banks in Nigeria. The paper recommended amongst
others that players in the financial services sector should enhance the development of their
workers through regular trainings, appraisals and remunerations necessary for good corporate
performance and sustainable growth.