Nigerian Journal of Banking and Financial Issues (NJBFI)

FINANCIAL CRIMES NIGERIA IMPACT ASSESSMENT ON QUOTED BANKS IN NIGERIA EXCHANGE.

Abstract

This paper investigated the effects of an exposure to financial crime to the performance and market valuation of banks listed on the Nigerian Exchange over 2020 to 2024. Based on the secondary data on annual financial reports, disclosures on frauds filed in the annual reports and the performance of the stocks of the ten purposively chosen banks, the research provide an evaluation of the interactions between the fraud cases, financial losses, and regulatory actions and key financial performance measures considering Return on Assets (ROA), Return on Equity (ROE) and Earnings Per Share (EPS). Moreover, it seeks to determine the relationship between stock price fluctuations and financial crime, and investigates the modifying effect of forensic accounting practices. Descriptive statistics, correlation matrices, multiple regressions were used. The findings reveal that an increase in exposure to financial crimes has an insignificant and positive impact on profitability (ROA, ROE, EPS) and loss of shareholder wealth via stock returns volatility. Nevertheless, financial institutions whose forensic accounting and internal control systems were well established showed higher tolerance to financial impacts caused by fraud.