Authors : H.T. Iwarere and G.T. Akinleye
Abstract: This study examines the factors considered in choosing appropriate amount of equity and debt capital in Nigeria banking industry using data gathered through a survey conducted. The results identifies that credit rating, volatility of earnings, cash flow, financial distress, transaction costs and financial flexibility are the important factors in choosing appropriate amount of debt for bank. The results equally identifies factors responsible for making equity issues to be how to fund a major expansion, factors influencing banks capital structure, ownership structure and management control like growth opportunity, profitability, issuing cost, tax economics associated with debt financing per share. It is recommended that banks should adopt an appropriate mix source of fund, reduce debt issue, invest in more liquid assets through the reduction of tangible assets.
H.T. Iwarere and G.T. Akinleye, 2010. Capital Structure Determinants in the Nigerian Banking Industry: Financial Managers’ Perspectives. Pakistan Journal of Social Sciences, 7: 205-213.