Liquidity Risk and Profitability of Listed Deposit Money Banks in Nigeria

Illiquidity of firms especially banks can lead to loss of businesses thereby reducing the potentials of earnings and profitability; this is because high liquidity position of a firm helps it to meet with some obligations which lead to funding of loans and advances that could aid banks to earn income in the form of interests on loans. The study examined the effect of liquidity risk on financial performance of listed Deposit Money Banks (DMBs) in Nigeria covering a period of ten years (2009-2018).This study adopted an ex-post facto research design.  The population of the study was 15 deposit money banks listed on the Nigerian Stock Exchange and employed panel regression analysis with emphasis on pooled, fixed and random effect models. Secondary data were sourced from the annual reports of the 14 selected quoted banks in Nigeria. The Hausman test was used to justify the appropriate model and inferences were made at 5 percent significant level.  The findings revealed that Liquidity risk had significant effects on profitability. In particular, it was established that Liquidity risk indicators had positive and significant effects on individual profitability variables; viz: Return on equity of deposit money banks in Nigeria (β = 49.76, p = 0.000), Return on Assets (β = 12.87, p = 0.005) and Earnings per share (β =20.92, p = 0.000). The study concluded that Liquidity risk has significant effect on return on equity, return on assets and earning per share of deposit Money Banks listed in Nigeria. The study, therefore, recommended that management of banks should establish strategies to better manage their cash-flows in each product segment and maintain an optimal levels in order to earn higher returns from high volume of idle cash balances. Key words: Earnings per share, Liquidity risk management, Return on assets, Return on equity, Nigeria. Word Count: 284 words. DOI: 10.7176/RJFA/11-8-13 Publication date: April 30th 2020

Capital Structure and Profitability of Downstream Oil and Gas Firms Listed in Nigeria

The Nigerian downstream oil and gas sector in the last few years have witnessed a plethora of challenges such as infrastructural decay, rising cost of importation of petroleum products (fuel, diesel, aviation fuel and kerosene) which is a fallout of breakdown of the nation’s refineries. The study examined the impact of capital structure on the profitability of firms in the downstream sector of the oil and gas industry in Nigeria from 2000 to 2018. This study adopted an ex-post facto research design. The study employed a dynamic panel system equation of generalized method of moment. Secondary data were sourced from the annual reports of the 8 selected oil and gas companies listed in Nigeria. The study applied descriptive statistics, correlation, and unit root test as well as inferential statistics. Inferences were made at 5 percent significant level. Results showed that Debt Capital ratio had a negative and significant relationship with ROA (β = -0.0257, t=-5.147, p<0.05). Also, Equity Capital ratio had a positive and significant relationship with current ROA (β = 0.228, t=5.3015p<0.05). Lastly, Interest Rate had a positive and insignificant relationship with current ROA (β = 0.247, t=4.3521, p<0.05). The study concluded that while debt capital ratio had a significant inverse effect on firms’ profitability, equity capital ratio had a positive and significant effect on the profitability of the selected oil and gas firms. The result also affirmed that interest rate had a positive and insignificant effect on profitability of selected oil and gas firms. The study recommended that Oil and Gas sector should increase equity financing and reduce debt financing. This equity can be enhanced through increased in the amount of ploughed back profit/retained earnings and bonus issue. Word counts: 281 Keywords: Capital Structure, Profitability, Equity capital ratio, Debt Capital ratio DOI: 10.7176/RJFA/11-8-02 Publication date: April 30th 202

Inflation and Standard of Living in Nigeria

Standard of living is very germane to every economy. It gives a broad view of how the economy is fairing on a global scale. If an individual cannot get required basic necessities due to low purchasing power, his/her marginal propensity to consume (MPC) rises which makes it more difficult for the individual to live comfortably hence the standard of living dips Several researches have been carried out but the standard of living still remains abysmally low. From empirical review we find that several countries in sub-Sahara Africa, Nigeria inclusive suffers from low standard of living. The case of Nigeria being evidently sever as the Nigeria currently the poverty capital of the world with over 91 million people living below in abject poverty. Time series data on inflation rate and standard of living proxied by the Human Development Index (HDI) between 1998 and 2017 was used for this research. Augmented Dickey Fuller and Phillip-Perron unit root tests were used to test for stationarity of the data. Based on findings, the Auto Regressive Distributed Lagged (ARDL) model was adopted for inferential analyses. Descriptive statistics employed include skewness, kurtosis, Jarque-Bera test and Breuch-Pagan-Godfrey serial correlation LM test, Breuch-Pagan test for heteroscedasticity and the Durbin-Watson test. Results indicated that there exists a long-run relationship between Inflation and standard of living. Inflation exhibited a negative and significant effect with a coefficient of -0.034 against a P-value of 0.017 which implied that a unit increase in inflation brings about 0.034unit decrease in standard of living over the period of study. Based on findings we recommend that a proper blend of fiscal and monetary policies should be employed to improve the standard of living of Nigerians. Keywords: Inflation rate, Monetary policies, Poverty, Standard of living, Fiscal policies DOI: 10.7176/DCS/10-4-06 Publication date: April 30th 202

Ultrasonic Study of Water Adsorbed in Nanoporous Glasses

Thermodynamic properties of fluids confined in nanopores differ from those observed in the bulk. To investigate the effect of nanoconfinement on water compressibility, we performed water sorption experiments on two nanoporous glass samples while concomitantly measuring the speed of longitudinal and shear ultrasonic waves in these samples. These measurements yield the longitudinal and shear moduli of the water laden nanoporous glass as a function of relative humidity that we utilized in the Gassmann theory to infer the bulk modulus of the confined water. This analysis shows that the bulk modulus (inverse of compressibility) of confined water is noticeably higher than that of the bulk water at the same temperature. Moreover, the modulus exhibits a linear dependence on the Laplace pressure. The results for water, which is a polar fluid, agree with previous experimental and numerical data reported for non-polar fluids. This similarity suggests that irrespective of intermolecular forces, confined fluids are stiffer than bulk fluids. Accounting for fluid stiffening in nanopores may be important for accurate interpretation of wave propagation measurements in fluid-filled nanoporous media, including in petrophysics, catalysis, and other applications, such as in porous materials characterization