Anon Jonah Ehiabhi


The performance of microfinance banks (MFBs) in Nigeria is a major economic and political issue that has been the subject of various studies. The relationship between shareholders and managers of MFBs is expected to result in profitability if all norms in the act of funding, monitoring, management, and work environment are met. However, a considerable number of these institutions were forced to collapse. As a result, the government’s efforts to employ MFBs to enhance rural people’ living standards, alleviate poverty, and provide microcredit to both rural and urban populations failed to provide the desired results. Accounting choices and disclosures in financial reporting can be harmed by opportunistic financial information distortion driven by a manager’s desire to fulfil predetermined earnings targets. Accounting measures’ reliability and informative value will be degraded if their contracting and controlling responsibilities are breached, because they are utilized to judge a company’s underlying economic performance. As a result, in order for the agents to play the dependable, contracting, and regulating roles that the principal expects, the metrics must be done with a high level of trust in them. Agents regularly backslide on this position due to management opportunism, resulting in the system’s inability to provide expected revenues with the agent’s and professionals’ honesty. All traditional banking activities and programs that were previously only available in person at a bank branch have been digitized. By eliminating human mistake and enhancing customer loyalty, digital banking may help microfinance institutions counteract the influence of management opportunism on their success. In the context of digital banking, the impact of management opportunism on the performance of microfinance banks in Nigeria was explored. The results of both fixed and random effects estimations revealed that none of the parameters included to explain the consequences of managerial opportunism on microfinance bank performance in Nigeria are significant, with digital banking as one of the control variables. This suggests that managerial opportunism has no influence on the performance of microfinance banks in Nigeria when it comes to digital banking.


Managerial Opportunism, Digital Banking, Performance, Microfinance Banks, Banks.

Full Text:



Acha I. A. (2012), International Journal of Finance and Accounting p-ISSN: 2168-4812 e-ISSN: 2168-4820 2012; 1(5): 106-111 doi: 10.5923/j.ijfa.20120105.04

Arrow, K. (1985). The Economics of Agency. Principals and Agents: The Structure of Business. Boston: Harvard Business School Press, 37-51

Ferri.,Fabrizio., Maber., David. 2009. „Say on pay vote and CEO compensation: Evidence from the UK‟

Asika, N (1991): Research Methodology in the Behavioural Sciences, Longman Nigeria, Lagos. Assessment and Evaluation in Higher Education 19 (2), 99-108.

Athanasoglou, P.P., Brissimis, S.N. and Delis, M.D. (2005) “Bank-Specific, Industry-Specific and Macroeconomic Determinants of Bank Profitability”Bank of Greece Working Paper, No. 25.

Bakerman, H. G., & Gomez-Mejia, L. R. 1988. Managerial compensation and firm performance: A general research framework. Academy of Management Journal, 41: 135-145.

Banard Chester I(1972) The Functions of the Executive, Cited in Richard H. Hall, Organizations: Structure& Process. Eaglewood Cliffs, New Jersey: Prentice Hall, Inc., 1972.

Barnett, R. (1992). Improving Higher Education. Total Quality Care. Buckingham: SRHE & Open University Press.

Bello, Abdullahi, (2005), “ Bank Consolidation and =N= 25 billion Recapitalization Another Perspective”, extracted on 23rd August, 2010.

Bergen, M., Dutta, S. &Walker, O.C. Jr. (1992). Agency Relationships in Marketing:A Review of the Implications and Applications of Agency and Related Theories.

Bohren, O. (1998). The Agent’s Ethics in the Principal-Agent Model. Journal of Business Ethics 17, 745-755.

Braun, D. (1993). Who Governs Intermediary Agencies? Principal-Agent Relations in Research Policy-Making. Journal of Public Policy 13 (2), 135- 162. Brehm, J. and Gates, S. (1997). Working, Shirking and Sabotage. Bureaucratic Response to a Democratic Public. (Paperbacked). AnnArbor: The University of Michigan Press.

Broadbent, J., Dietrich, M. & Laughlin, R. (1996). The Development of Principal Agent, Contracting and Accountability Relationships in the Public Sector: Conceptual and Cultural Problems. Critical Perspectives on Accounting 7 (3), 259-284.

Brown Johnson, N. &Droege, S. (2004). Reflections on the generalisation of agency theory: Cross-cultural

Cave, M., Hanney, S., Henkel, M. &Kogan, M. (1997). The Use of Performance Indicators in Higher Education. The Challenge of the Quality Movement. Higher Education Policy Series 34. (3rd ed.). London: Jessica Kingsley Publishers

Central Bank of Nigeria (1986). Report on Monetary policy and guideline on Financing credit rural banking

Charreaux, G. (2002). Positive agency theory: place and contribution. In Brousseau E. &Glachant, J-M. (eds.) The Economics of Contracts. Theories and Applications. Cambridge: Cambridge University Press Chicago, IL.

Chipunza, Crispen, Samuel, O. Michael, and Mariri, Tendai,. (2011), Leadership style, employee motivation and commitment: Empirical evidence from a consolidated retail bank operating in a depressed economy, African journal of business management Vol 5(20), pp. 8,337-8,346

Cambridge surveys of economic literature. Cambridge University Press.

Eisenhardt, K. (1989). Agency theory: An assessment and review. Academy of Management Review 14 (1), 57-74.

Godfrey, J., Hodgson, A., Holmes, S., &Tarca, A. (2006). Accounting Theory (6th ed). Australia: John Wiley.

Gomez-Mejia, L.R. &Balkin, D.B. (1992). Determinants of Faculty Pay: An Agency Theory Perspective. Academy of Management Journal 35 (5), 921- 955.

Gornitzka, Å.,Stensaker, B., Smeby, J-C. & de Boer, H. (2004). Contract Arrangements in the Nordic Countries. – Solving the Efficiency/ Effectiveness Dilemma? Higher Education in Europe 29 (1), 87-101.

Gul., F., &Tsui, J. (2001). Free cash flow, debt monitoring and audit pricing: Further evidence on the role of director equity ownership. Auditing: A journal of Practice& Theory, 20(2), 71-84.

Healy, P., Kang, S., & Palepu, K. (1987). The effect of accounting procedure changes on CE Oiis cash salary and bonus compensation. Journal of Accounting and Ecnomics,9(January), 7-34.

Hendry, J. (2005). Beyond Self-Interest: Agency Theory and the Board in a Satisfying World. British Journal of Management 16 (1), S55-S63.

Hesterly, W. S., Liebeskind, J. & Zenger, T. R. (1990).Organizational Economics: An Impending Revolution in Organization Theory? Academy of Management Review 15 (3), 402-420.

Hirtle, Beverly, (2007). "The impact of network size on bank branch performance," Journal of Banking & Finance, Elsevier, vol. 31(12), pages 3782-3805, December.

Hlupeko D and Matanda E, (2015), “The Downfall Of The Micro Lending Businesses in Zimbabwe: Causes And Remedies” International Review Of Research In Emerging Markets and The Global Economy (Irrem)

Kim, P. K., &Rasiah, D. (2010). Relationship between corporate governance and bank performance in Malaysia during the pre and post Asian financial crisis. European Journal of Economics, Finance and Administrative Sciences, 11(2), p. 25.

Kirby, S. L. & Davis, M. A.(1998).A Study of Escalating Commitment in Principal- Agent Relationships: Effects of Monitoring and Personal Responsibility. Journal of Applied Psychology 83 (2), 206-217.

Kivistö, J.A. (2005). Agency Theory as a Theoretical Framework for Describing Government-University Relationships – Strengths and Weaknesses of the Theory.

Paper presented at the Annual Conference of the Association for the Study of Higher Education (ASHE). November 16 – 20, 2005, Philadelphia, PA.

Koehn, M., Santomero, A. 1980. Regulation of bank capital and portfolio risk.

Journal of Finance 35, 1235-1244.

Koelble, T.A. (1996). Economic Theories of Organization and the Politics of Institutional Design in Political Parties. Party Politics 2 (2), 251-263.

Koontz, H, O’ Donnel, N C and Weihrich, H (1980). Management, International students Edition, Aukland: McgrawHill International Book Company,

Kutum (2015) Predicting the Financial Distress of Non-Banking Companies Listed on the Palestine Exchange (PEX) Research Journal of Finance and Accounting www.iiste.orgISSN 2222-1697 (Paper) ISSN 2222-2847 (Online) Vol.6, No.10, 2015 79

Laffin, M. (1997). Understanding Minister-Bureaucrat Relations: Applying Multi- Theoretic Approaches in Public Management. Australian Journal of Public Administration 56 (1), 45-58.

Lambert, R.A.(2001).Contracting theory and accounting. Journal of Accounting and Economics 32 (1-3),3-87.

Lane, J.E. (2005). Agency Problems with Complex Principals. State Oversight of Higher Education: A Theoretical Review of Agency Problems with Complex Principals. Paper presented at the Annual Conference of the Association for the Study of Higher Education (ASHE). November 16 – 20, 2005, Philadelphia, PA.


  • There are currently no refbacks.

Copyright (c) 2022 Anon Jonah Ehiabhi










ISSN (PRINT):    2682 - 6135

ISSN (ONLINE): 2682 - 6127





Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.