Extent of Dividend Smoothening in Nigerian Banking Industry
This study examined the extent of dividend smoothening in Nigeria Deposit Money Banks. This is with the intention to investigate the degree at which they pay dividend relative to their earnings. The study used secondary data. The data were gathered from the records of the Nigerian Exchange Group, Central Bank of Nigeria, and banks? financial statements. The population of the study was the entire 14 listed deposit money banks. Ten (10) among the banks were selected with the use of judgmental sampling technique. Data were analyzed with the descriptive and inferential statistics. The results showed that all the listed banks observed between 2010 and 2019 smoothened dividend at different degree ranging from high (>1) moderate (<1> 0.6) and low (? 0.6). The result also revealed that out of the 10 sampled DMBs, 20% has high level of dividend smoothening while 70% moderately smoothening dividend. This implies that they were able to balance between high level and low level of dividend smoothening. The findings further showed that 10% has low degree of dividend smoothening. The study concluded that managers greatly influence dividend policy in the Nigerian banking industry. The study recommended the need for the setting up of a regulatory body that will always look into the dividend payout of banks annually. This is to ascertain that dividends are not smoothened and there should be a regulatory body that will ensure that any payment is done out of distributable profit. Keywords: Dividend, Dividend smoothening, Deposit money banks, Payout policy JEL Classification:…