The Effect of Deposit Money Banks (DMBS) Performance on Interest Rates: Evidence from Nigeria

This study examined the impact of interest rate on deposit money banks performance in Nigeria for the period of 2010-2019. The interest rate was proxied by the monetary policy rate of the CBN while bank performance was proxied by row assets, total liabilities and total deposits of deposit money banks in Nigeria. Ordinary Least Square (OLS) simple regression technique was employed to analyze the data in order to determine the impact of the independent variable on the various dependent variables. Findings showed that Monetary Policy Rate had a positive and significant impact to the total asset i.e., t statistic (20.79420) and p-value of (0.040) and total liabilities i.e., t-statistics (20.79420) and the p-value (0.0402) of deposit money banks in Nigeria economy but has a negative and insignificant impact to total deposit i.e. t-statistics (-1.943590) was negatively signed and the p-value (0.3556) was insignificant. The study concluded that monetary policy rate has significant relationship on deposit money bank performance in Nigeria. The researcher recommended that well-structured monetary policy rate by the CBN will enhance the performance of Deposit Money Banks in Nigeria