The Journal of Accounting and Management, Vol 4, No 1 (2014)

Capital structure and the value of the firm: evidence from the Nigeria banking industry

adedoyin isola LAWAL

Abstract


Using data sourced from Nigerian commercial banks between the periods 2007 to 2012; this study examined the factor that magnifies the value of a firm. We used OLS technique and White-HAC heteroskedastcity test to infer the relationship between capital structure and the value of a firm in Nigeria. It was observed that debt instrument play significant role in magnifying the value of Nigerian banking firms, while equity role is partially significant. We suggest that bank managers as well as regulators adopt measures that will promote leverage usage so as to maximise the overall value of the firm.


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