Recapitalization and Return on Assets of Selected Insurance Companies in Nigeria (2010-2019)

Authors

  • Dr. Abimbola Ayodeji Cole Department Finance, Babcock University, Ilishan-Remo, Ogun State, Nigeria
  • Dr. Abolade Francis Akintola Department Finance, Babcock University, Ilishan-Remo, Ogun State, Nigeria

Keywords:

Recapitalization, Shareholders’ wealth, Return on assets and Capital base.

Abstract

Abstract: The study investigated recapitalization and return on assets (ROA) of selected insurance companies in Nigeria from 2010-2019. Ex-post facto research design was adopted for this study from the secondary data obtained from the Nigerian Stock Exchange Factbook. Of the twenty-three (23) insurance companies listed on the Stock Exchange, ten (10) of them were selected for this study. Panel regression analysis was employed for this study. The study concluded that recapitalization has significant effect on return on assets of insurance companies in Nigeria. The study therefore recommended that management of insurance companies should take advantage of increase in their capital base to generate more profit in order to maximize shareholders wealth.

References

Adegbaju, A.A. and Olokoyo, F.O. 2008. Recapitalization and banks performance: A case of Nigerian Banks. African Economic Business Review, 6(1): 1-17.

Adeyele, J.S. and Maiturare, M.N. 2012. Repositioning the Nigerian insurance industry for sustainable development. Risk management perspective. European Journal of Business Management, 4(5): 22-31.

Ahmed, I. 2016. Effect of capital size on the profitability of listed insurance firms in Nigeria. African Journal of Business, 10(5): 109-113.

Alani, G.O. and Sani, J. 2019. Effect of recapitalization on financial performance of insurance companies in Nigeria. International Journal of Public Administration and Management Research, 5(1): 146-160.

Anbrose, A.O., Saratu, I.J. and Datong, G.D. 2018. Effect of recapitalization on profitability of quoted deposit money banks in Nigeria. Journal of Accounting and Financial Management, 4(4): 109.

Deccan, H. 2004. New banking reforms to focus on consolidation. New Delhi DHNS: www.deccanherald.com

Ibrahim, H. and Abubakar, S. 2011. Recapitalization and the profitability of quoted insurance companies in Nigeria. International Journal of Social Science and Humanities, 2(2): 114-121.

Kanu, C. and Isu, O.H. 2013. The impact of capitalization on bank performance in Nigeria 1970-2010: An assessment. International Review of Management and Business Research, 2(3): 643-652.

NAICOM. 2017. Objectives of Nigerian insurance sector reform. Retrieved from www.naicom.ng (21/12/2020)

NAICOM. 2019. Minimum paid-up share capital policy for insurance and reinsurance companies in Nigeria. NAICOM/DPR/CIR/25/2019

Olowe, R.A. 2017. Financial management, concept, financial system and Business Finance. 4th Edition, Briefly Jones Nigeria Limited, Lagos.

Oluitan, A., Ashamu, O. and Ogunkenu, I. 2015. The effect of recapitalization on bank performance in Nigeria. International Finance and Banking Journal, 2(1): 74-89.

Owolabi, A.O., Oloyede, F.A., Iriyemi, A.B. and Akinola, A.T. 2017. Impact of risk management on the profitability of insurance companies in Nigeria. International Journal of Marketing Technology, 7(9): 1-26.

Oyedotun, T.M. and Adesina, B.D. 2015. Nexus between economic growth and insurance business in Nigeria. Research Journal of Finance and Accounting, 6(9): 142-149.

Redja, G.E. and McNamera, M.J. 2014. Principles of risk management and insurance. 12th Edition, New York, Pearson Education Limited.

Siddik, N.A., Kabiraj., S. and Joghee, S. 2017. Impact of capital structure on performance of banks in a deposit money banks in a developing economy: Evidence of Bangladesh. International Journal of Financial Studies, 5(13): 1-18.

Downloads

Published

2021-10-08

How to Cite

Dr. Abimbola Ayodeji Cole, & Dr. Abolade Francis Akintola. (2021). Recapitalization and Return on Assets of Selected Insurance Companies in Nigeria (2010-2019). International Journal of Recent Innovations in Academic Research, 5(10), 1–7. Retrieved from https://ijriar.com/index.php/ijriar/article/view/121