This study empirically investigates the optimum synergy between liquidity and profitability management of quoted banks in Nigeria. Data were collected from secondary sources. The population of the study consists of all quoted Banks in Nigeria as at 31st December 2013. However, the sample size was determined using purposive sampling techniques. Profitability and liquidity variables were used and a multiple regression model, correlation analysis and F-tests were employed in testing the hypothesis at 5% level of significance. The result showed that there is a significant optimum synergy between liquidity and profitability management of banks in Nigeria. Also optimum liquidity and profitability management is achieved when a balance is struck between the two performance indicators in such a way that the pursuit of one of them does not lead to a detrimental effect on the other. The study recommends that banks should maintain optimum liquidity and profitability equilibrium. Moreover, appropriate and stiff sanctions should be taken against banks that mismanage their working capital. This study recommends that banks should be mindful of liquidity risks while pursuing their profit maximization objective.
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To cite this article: Yusuf, M. O., Nwufo, C. I., Chima E. I. (2019). Optimum Synergy between Liquidity and Profitability Management of Quoted Banks: The Nigerian Perspective, International Journal of Academic Research in Accounting, Finance and Management Sciences 9 (2): 138-148.
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