DIVIDEND POLICY AND SHARE PRICE VOLATILITY: EVIDENCE FROM LISTED DEPOSIT MONEY BANKS IN NIGERIA
Journal Title: Gusau Journal of Accounting and Finance - Year 2020, Vol 1, Issue 2
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.
Authors and Affiliations
Isiaka Olalekan Lasisi, James George Apochi, Asma’u Mahmood Baffa, Kabiru Badawiyu
Keywords
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- EP ID EP709194
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