Dividend policy refers to firm decision framework on payout pattern from corporate earnings, the quantum of such payment has largely conveyed acceptance/rejection information about such share in the Nigerian capital market. Firm’s dividend policy has been identified as a major determinant of investors’ attraction to a corporate share in the capital market. The main objective of this study is to evaluate the effects of dividend policy on corporate performance in selected Nigeria Deposit Money Banks (NDMBs). Purposive random sampling method was used to select seven out of the sixteen quoted NDMBs based on the size of their capital. Secondary data used were obtained from annual reports of sampled NDMBs and Nigerian Stock Exchange over a period of ten years (2008-2018). The variables used in this study included Retained Earnings (RE), Earning Per Share (EPS), Dividend Per Share (DPS), Share Capital (SC), Dividend Payout (DPO), Asset growth (AG), Capital Investment (CI), Collected data were analyzed using both descriptive and inferential statistics such as the mean, Standard deviation and Panel regression. Panel regression was used to examine the effect of capital investment and asset growth on dividend payout of NDMBs. The results showed that RE, EPS and DPS had positive significant effect on DPO with coefficient value of 0.459; (p < 0.000), 0.003; (p < 0.003), 0.788; (p < 0.001) respectively with Adj. R2 = 0.311. Further result revealed that SC, RE, AG and CI have positive significant effect on DPO with coef. = 0.375; (p < 0.000), 2.198; (p < 0.002), 0.397; (p < 0.013) 1.658 (p < 0.002) respectively with Adj.R2 = 0.379. The research concluded that capital investment and asset growth have significant effect on corporate performance of NDMBs. This study recommended that, managers should increase the level of capacity to improve profitability. They should be consistent with dividend payout ratio of the shareholder of NDMBs.
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