Effect of Internationalization on Earnings Per Share in Deposit Money Banks in Selected African Countries

Cletus Oluwadare Ebe; Folajimi Festus Adegbie; Ayodeji Temitope Ajibade

doi:doi:10.11648/j.jfa.20231103.12

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Effect of Internationalization on Earnings Per Share in Deposit Money Banks in Selected African Countries

Cletus Oluwadare Ebe, Folajimi Festus Adegbie, Ayodeji Temitope Ajibade

Published in Journal of Finance and Accounting (Volume 11, Issue 3)

Received: 25 April 2023 Accepted: 11 May 2023 Published: 18 May 2023

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Abstract

Performance expectation and shareholders’ wealth creation have made banks to take their banking operations beyond their immediate local environments. Research has shown that banks take advantage of crossboarder activities to improve and increase their earnings and ultimately increase shareholders’ wealth maximization motive of the banks. There have been divergent results and opinions on the impact of banks’ foreign operations on the total performance of the banks. Consequently, in contributing to knowledge, this study examined the effect of internationalization on earnings per share in Deposit Money Banks in slected African countries. This research examined the impact of internationalization on earnings per share in deposit money banks in Nigeria, South Africa and Kenya between 2007 and 2021 using expo facto research design. Purposive sampling technique was employed to select seventeen deposit money banks out of a population of seventy-one banks that had international operations authorization licences in the selected countries. Secondary dat were extracted from the published annual financial statements of the selected banks. The data were considered valid and reliable because of the independent opinions expressed on them by the various external auditors. The data were ananlysed using descriptive and inferential statistics. The result obtained from the multiple regression analysis suggested that internationalization exhibited a significant effect on earnings per share, (Ad jR² = 0.0145; F(5, 249) = 23.54; p<0.05). In addition, exchange rate significantly controlled the effect of internationalization on earnings per share (Adj. R² = 0.0285; F(6, 248) = 13.14; p<0.05. The study concluded that internationalization affected earnings per share in DMBs in selected African countries. The study therefore recommended that investors should be concerned and carefully evaluate the reasons for the banks going international. Also, policymakers, financial regulators and the government should not be in a haste approving internationalization banking authorizations to banks, when huge opportunities still subsist in the domestic level.

Published in	Journal of Finance and Accounting (Volume 11, Issue 3)
DOI	10.11648/j.jfa.20231103.12
Page(s)	67-78
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Earnings Per Share, Shareholders, Wealth Maximisation, Deposit Money Bank, Internationalization

References

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Cletus Oluwadare Ebe, Folajimi Festus Adegbie, Ayodeji Temitope Ajibade. (2023). Effect of Internationalization on Earnings Per Share in Deposit Money Banks in Selected African Countries. Journal of Finance and Accounting, 11(3), 67-78. https://doi.org/10.11648/j.jfa.20231103.12

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Cletus Oluwadare Ebe; Folajimi Festus Adegbie; Ayodeji Temitope Ajibade. Effect of Internationalization on Earnings Per Share in Deposit Money Banks in Selected African Countries. J. Finance Account. 2023, 11(3), 67-78. doi: 10.11648/j.jfa.20231103.12

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Cletus Oluwadare Ebe, Folajimi Festus Adegbie, Ayodeji Temitope Ajibade. Effect of Internationalization on Earnings Per Share in Deposit Money Banks in Selected African Countries. J Finance Account. 2023;11(3):67-78. doi: 10.11648/j.jfa.20231103.12

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@article{10.11648/j.jfa.20231103.12,
  author = {Cletus Oluwadare Ebe and Folajimi Festus Adegbie and Ayodeji Temitope Ajibade},
  title = {Effect of Internationalization on Earnings Per Share in Deposit Money Banks in Selected African Countries},
  journal = {Journal of Finance and Accounting},
  volume = {11},
  number = {3},
  pages = {67-78},
  doi = {10.11648/j.jfa.20231103.12},
  url = {https://doi.org/10.11648/j.jfa.20231103.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jfa.20231103.12},
  abstract = {Performance expectation and shareholders’ wealth creation have made banks to take their banking operations beyond their immediate local environments. Research has shown that banks take advantage of crossboarder activities to improve and increase their earnings and ultimately increase shareholders’ wealth maximization motive of the banks. There have been divergent results and opinions on the impact of banks’ foreign operations on the total performance of the banks. Consequently, in contributing to knowledge, this study examined the effect of internationalization on earnings per share in Deposit Money Banks in slected African countries. This research examined the impact of internationalization on earnings per share in deposit money banks in Nigeria, South Africa and Kenya between 2007 and 2021 using expo facto research design. Purposive sampling technique was employed to select seventeen deposit money banks out of a population of seventy-one banks that had international operations authorization licences in the selected countries. Secondary dat were extracted from the published annual financial statements of the selected banks. The data were considered valid and reliable because of the independent opinions expressed on them by the various external auditors. The data were ananlysed using descriptive and inferential statistics. The result obtained from the multiple regression analysis suggested that internationalization exhibited a significant effect on earnings per share, (Ad jR2 = 0.0145; F(5, 249) = 23.54; p2 = 0.0285; F(6, 248) = 13.14; p<0.05. The study concluded that internationalization affected earnings per share in DMBs in selected African countries. The study therefore recommended that investors should be concerned and carefully evaluate the reasons for the banks going international. Also, policymakers, financial regulators and the government should not be in a haste approving internationalization banking authorizations to banks, when huge opportunities still subsist in the domestic level.},
 year = {2023}
}

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TY  - JOUR
T1  - Effect of Internationalization on Earnings Per Share in Deposit Money Banks in Selected African Countries
AU  - Cletus Oluwadare Ebe
AU  - Folajimi Festus Adegbie
AU  - Ayodeji Temitope Ajibade
Y1  - 2023/05/18
PY  - 2023
N1  - https://doi.org/10.11648/j.jfa.20231103.12
DO  - 10.11648/j.jfa.20231103.12
T2  - Journal of Finance and Accounting
JF  - Journal of Finance and Accounting
JO  - Journal of Finance and Accounting
SP  - 67
EP  - 78
PB  - Science Publishing Group
SN  - 2330-7323
UR  - https://doi.org/10.11648/j.jfa.20231103.12
AB  - Performance expectation and shareholders’ wealth creation have made banks to take their banking operations beyond their immediate local environments. Research has shown that banks take advantage of crossboarder activities to improve and increase their earnings and ultimately increase shareholders’ wealth maximization motive of the banks. There have been divergent results and opinions on the impact of banks’ foreign operations on the total performance of the banks. Consequently, in contributing to knowledge, this study examined the effect of internationalization on earnings per share in Deposit Money Banks in slected African countries. This research examined the impact of internationalization on earnings per share in deposit money banks in Nigeria, South Africa and Kenya between 2007 and 2021 using expo facto research design. Purposive sampling technique was employed to select seventeen deposit money banks out of a population of seventy-one banks that had international operations authorization licences in the selected countries. Secondary dat were extracted from the published annual financial statements of the selected banks. The data were considered valid and reliable because of the independent opinions expressed on them by the various external auditors. The data were ananlysed using descriptive and inferential statistics. The result obtained from the multiple regression analysis suggested that internationalization exhibited a significant effect on earnings per share, (Ad jR2 = 0.0145; F(5, 249) = 23.54; p2 = 0.0285; F(6, 248) = 13.14; p<0.05. The study concluded that internationalization affected earnings per share in DMBs in selected African countries. The study therefore recommended that investors should be concerned and carefully evaluate the reasons for the banks going international. Also, policymakers, financial regulators and the government should not be in a haste approving internationalization banking authorizations to banks, when huge opportunities still subsist in the domestic level.
VL  - 11
IS  - 3
ER  -

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Cletus Oluwadare Ebe

Department of Accounting, Babcock University, Ilishan-Remo, Nigeria
Folajimi Festus Adegbie

Department of Accounting, Babcock University, Ilishan-Remo, Nigeria
Ayodeji Temitope Ajibade

Department of Accounting, Babcock University, Ilishan-Remo, Nigeria

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Cletus Oluwadare Ebe, Folajimi Festus Adegbie, Ayodeji Temitope Ajibade. (2023). Effect of Internationalization on Earnings Per Share in Deposit Money Banks in Selected African Countries. Journal of Finance and Accounting, 11(3), 67-78. https://doi.org/10.11648/j.jfa.20231103.12

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Cletus Oluwadare Ebe; Folajimi Festus Adegbie; Ayodeji Temitope Ajibade. Effect of Internationalization on Earnings Per Share in Deposit Money Banks in Selected African Countries. J. Finance Account. 2023, 11(3), 67-78. doi: 10.11648/j.jfa.20231103.12

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Cletus Oluwadare Ebe, Folajimi Festus Adegbie, Ayodeji Temitope Ajibade. Effect of Internationalization on Earnings Per Share in Deposit Money Banks in Selected African Countries. J Finance Account. 2023;11(3):67-78. doi: 10.11648/j.jfa.20231103.12

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@article{10.11648/j.jfa.20231103.12,
  author = {Cletus Oluwadare Ebe and Folajimi Festus Adegbie and Ayodeji Temitope Ajibade},
  title = {Effect of Internationalization on Earnings Per Share in Deposit Money Banks in Selected African Countries},
  journal = {Journal of Finance and Accounting},
  volume = {11},
  number = {3},
  pages = {67-78},
  doi = {10.11648/j.jfa.20231103.12},
  url = {https://doi.org/10.11648/j.jfa.20231103.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jfa.20231103.12},
  abstract = {Performance expectation and shareholders’ wealth creation have made banks to take their banking operations beyond their immediate local environments. Research has shown that banks take advantage of crossboarder activities to improve and increase their earnings and ultimately increase shareholders’ wealth maximization motive of the banks. There have been divergent results and opinions on the impact of banks’ foreign operations on the total performance of the banks. Consequently, in contributing to knowledge, this study examined the effect of internationalization on earnings per share in Deposit Money Banks in slected African countries. This research examined the impact of internationalization on earnings per share in deposit money banks in Nigeria, South Africa and Kenya between 2007 and 2021 using expo facto research design. Purposive sampling technique was employed to select seventeen deposit money banks out of a population of seventy-one banks that had international operations authorization licences in the selected countries. Secondary dat were extracted from the published annual financial statements of the selected banks. The data were considered valid and reliable because of the independent opinions expressed on them by the various external auditors. The data were ananlysed using descriptive and inferential statistics. The result obtained from the multiple regression analysis suggested that internationalization exhibited a significant effect on earnings per share, (Ad jR2 = 0.0145; F(5, 249) = 23.54; p2 = 0.0285; F(6, 248) = 13.14; p<0.05. The study concluded that internationalization affected earnings per share in DMBs in selected African countries. The study therefore recommended that investors should be concerned and carefully evaluate the reasons for the banks going international. Also, policymakers, financial regulators and the government should not be in a haste approving internationalization banking authorizations to banks, when huge opportunities still subsist in the domestic level.},
 year = {2023}
}

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TY  - JOUR
T1  - Effect of Internationalization on Earnings Per Share in Deposit Money Banks in Selected African Countries
AU  - Cletus Oluwadare Ebe
AU  - Folajimi Festus Adegbie
AU  - Ayodeji Temitope Ajibade
Y1  - 2023/05/18
PY  - 2023
N1  - https://doi.org/10.11648/j.jfa.20231103.12
DO  - 10.11648/j.jfa.20231103.12
T2  - Journal of Finance and Accounting
JF  - Journal of Finance and Accounting
JO  - Journal of Finance and Accounting
SP  - 67
EP  - 78
PB  - Science Publishing Group
SN  - 2330-7323
UR  - https://doi.org/10.11648/j.jfa.20231103.12
AB  - Performance expectation and shareholders’ wealth creation have made banks to take their banking operations beyond their immediate local environments. Research has shown that banks take advantage of crossboarder activities to improve and increase their earnings and ultimately increase shareholders’ wealth maximization motive of the banks. There have been divergent results and opinions on the impact of banks’ foreign operations on the total performance of the banks. Consequently, in contributing to knowledge, this study examined the effect of internationalization on earnings per share in Deposit Money Banks in slected African countries. This research examined the impact of internationalization on earnings per share in deposit money banks in Nigeria, South Africa and Kenya between 2007 and 2021 using expo facto research design. Purposive sampling technique was employed to select seventeen deposit money banks out of a population of seventy-one banks that had international operations authorization licences in the selected countries. Secondary dat were extracted from the published annual financial statements of the selected banks. The data were considered valid and reliable because of the independent opinions expressed on them by the various external auditors. The data were ananlysed using descriptive and inferential statistics. The result obtained from the multiple regression analysis suggested that internationalization exhibited a significant effect on earnings per share, (Ad jR2 = 0.0145; F(5, 249) = 23.54; p2 = 0.0285; F(6, 248) = 13.14; p<0.05. The study concluded that internationalization affected earnings per share in DMBs in selected African countries. The study therefore recommended that investors should be concerned and carefully evaluate the reasons for the banks going international. Also, policymakers, financial regulators and the government should not be in a haste approving internationalization banking authorizations to banks, when huge opportunities still subsist in the domestic level.
VL  - 11
IS  - 3
ER  -

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