2020 iBAF

This study investigated the impact of market risk on the market value, using panel data evidence from the annual reports and financial statements of 8 listed deposit money banks in Nigeria over a 10-year period from 2010 to 2019. Descriptive statistics and random effects model were utilised in the analysis of data. Results indicate that degree of financial leverage has significant and positive impact on the market value, while interest rate risk and foreign exchange exposure have no significant impact on the market value measured by Tobin’s Q. The study concludes that listed deposit money banks in Nigeria were able to trade-off the tax shields benefit of debt against the cost of financial distress; thereby expanding their earnings. The study recommends that banks should expand their investment in fixed income securities in order to increase their earnings.

This study evaluated the effect of non-interest banking products on the financial performance of Jaiz bank Plc (the only full-fledged non-interest bank in Nigeria), using time series data generated from the annual reports and accounts of the bank, covering the period 2013- 2019. Descriptive statistics such as mean, median, minimum and maximum values are used in data presentation, while ordinary least squares regression is applied in the investigation of the effect of non-interest banking products (investment in Sukuk, investment in Istisna and investment in Ijara assets) on the financial performance surrogated by return on equity. Results reveal that investments in Sukuk and Ijara assets have significant positive effect on the financial performance; while investment in Istisna has significant negative effect on the financial performance. The study concludes that in the long run, investments in Sukuk and Ijara assets will enhance shareholders’ value, while investment in Istisna will attenuates shareholders’ earnings. The paper recommends that Jaiz bank Plc should consider more carefully the utility and value maximization of investment in Istisna in comparison to investments in Sukuk and Ijara assets.