ABSTRACT

The study was on an analysis of capital structure and its performance in Abia State, Nigerian Firm: A case study of five money banks which includes First Bank of Nigeria Plc, Diamond Bank Plc, Access Bank plc, Oceanic Bank Plc, Intercontinental Bank Plc, secondary data which includes publication, journals etc were used in generating data for this study. The data collected was analyzed using simple descriptive analyses such as bar chart, regression model and correlation. The result showed that there is a significant relationship between debt and equity at 1%. The banks also had the problem of raising funds and determining the best mix of financing their investment. Also, the selected banks are laced with the problem of how funds can be allocated to investment that will yield a good return in order to increase their performances. Low level earning affect the performance of the selected banks. Equity, assets and deposits where significant and positively related to the performances, liquidity was positively related to the performance of the banks. Equity was significant at 5% and positively related to the performance of the banks. While liabilities were significant at 5% and negatively related to the banks performances. The deposit of the selected banks was significant at 1% and positively related to the performance of banks. Banks should make use of equity in financing there investment than debt financing. This will help the banks in avoiding debt obligation from the creditors, banks should make sure that the fund rose through the use of equity and debts are used in project that wil yield good return to the banks. This will boost the performance of the banks and minimize the liability of the banks.