Working Capital Management and Financial Performance of Listed Deposit Money Banks (DMB) in Nigeria

The study investigated the effect of working capital management on the financial performance of listed Deposit Money Banks (DMB) in Nigeria for the period 2009 to 2023, 15 years. In doing so, cash management and receivable management constituting the independent variables were regressed on DMB’s financial performance in Nigeria, as represented by return on asset (ROA). The study adopted firm size and firm listing age as the control variables. Data collected were analysed using the STATA V.14 econometric software package. The panel fixed and random effects were employed and estimated the model of the study using the appropriate techniques. Specifically, the results of the study showed that cash management had a negative and insignificant effect on financial performance while receivable management had a positive and significant effect on financial performance. Based on the findings of the study, it recommended that Management of deposit money banks should introduce for policies that would enhance swift conversion of receivable to cash to improve financial performance. Policies on trade receivable period should be shortened since the shorter the receivable period the higher the financial performance of listed deposit money banks in Nigeria. Keywords: Cash Management, Deposit Money Banks, Panel Regression, Receivable Days, Return on Asset.