Deposit Money Banks are the backbone of the economy of any country.
They are the institutions specifically designed to further the capital
formation process through the attraction of deposits and the extension of
credit ( Dhanuskodi, Thangavelu, Venkatachalam & Sudalaimuthn,
2007). Despite these important roles, deposit money banks are exposed to
financial risks among many other risks. Financial risks reflect possibility of
loss associated with liquidity, capital adequacy, credit, profitability and
market. These risks, if not properly identified, evaluated, monitored and
controlled could jeopardize a bank’s operations or undermine its financial
conditions. In extreme cases, it could lead to a distressed or failed bank
with its ripple effects on all bank stakeholders such as loss of deposits,
investments, employment, credibility by depositors, shareholders, banks
staff, and bank regulators, examiners, supervisors and auditors respectively.
This Project uses growth models, capital adequacy model, assets quality
models, earnings quality models, liquidity models, charts and tables to
analyze and evaluate the trend and comparative financial performance of
Oceanic Bank International Plc, First Bank Plc and Access Bank Plc for the
financial periods spanning 2003 to 2007. Based on the results of the
analytical models applied on the ratio type of data collected from the case
studied banks, it is discovered that the three reviewed banks are well
capitalized. They exhibited a stable trend in the quality of their earning
assets and are highly liquid. However, the earnings quality of these banks
have been a disturbing one as it continuously moved downwards year-wise.
To reverse this declining earnings quality trend, various cost reduction and
cost control measures are recommended given the fact that the quality of
these banks assets are in good shape.