Moderating Effect of Risk Management Committee Expertise on the Relationship between Liquidity Risk and Value of Listed Deposit Money Banks in Nigeria

Abstract

The effect of liquidity risk on value of banks has become a global phenomenon, even the well performing banks are suddenly plunged into crisis if liquidity risk is not carefully monitored and managed. One of the main gaps of the study is the introduction of moderator variable. The objective of the study is to examine the moderating effect of risk management committee expertise on the relationship between liquidity risk and value of listed deposit money banks in Nigeria. The study has been designed to cover a period of twelve (12) years (2013 - 2024). The ex-post facto (correlational) research design has been used. The 13 listed deposit money banks in Nigeria formed the population of the study out of which twelve (12) companies have been selected to form the sample. The multiple linear regression, correlation and descriptive statistics have been used to analyze the data. The risk management committee expertise has negatively insignificantly moderates the relationship between Liquidity Risk and Price to Book Value. Liquidity Risk has negative and insignificant effect on Price to Book Value, current assets should always be greater than current liabilities in order for banks to always fulfill or meet their debt obligations as they fall due, without having to sell their fixed assets at distressed prices.