Revisiting the relationship between capital adequacy and the performance of deposit money bank in Nigeria

This study empirically examined the effect of capital adequacy on the performance of deposit money in Nigeria from 1990 to 2015. Data for the study were secondary data sourced from annual report of Access Bank Plc, CBN Statistical Bulletin and journal articles for the years under scope. We employed ADF unit root, Johansoncointegration and ECM techniques to analyze the nature of the relationship between capital adequacy (core capital and supplementary capital) and Performance (profitability) of deposit money bank. The result indicates that both forms of capital adequacy have positive and significant influence on bank profitability. We therefore recommend among others that provision of adequate capital regulation; provision of infrastructural base to support banking services and stability of the institution must be of imperative to the central monetary authority.