Effect of ICT Software Expenditure on Financial Performance Among Listed Deposit Money Banks in Nigeria

This study investigates the effect of Information and Communication
Technology (ICT) software on the profitability of listed deposit money banks (DMBs)
in Nigeria, addressing the concern that rising technology expenditures may not always
yield proportional returns. The main objective is to assess the relationship between
computer software investments and profitability, providing empirical evidence for
informed financial decision-making in the banking sector. The study adopts a
quantitative research design grounded in the positivist philosophy, emphasizing
objectivity and empirical validation. Secondary data were obtained from the annual
reports and financial statements of listed DMBs in Nigeria. Using purposive sampling,
banks with complete and reliable financial data were selected. Analytical techniques
employed include descriptive statistics, correlation analysis, and multiple regression
analysis, with additional diagnostic tests to ensure the robustness of the model. The
findings reveal a negative and statistically significant relationship between computer
software expenditure and bank profitability, indicating that such investments may
impose substantial short-term financial burdens. The study concludes that while ICT
software plays a critical role in modern banking, poorly aligned or excessive
expenditures can diminish profitability. It recommends that DMBs strategically
manage software investments, ensuring careful cost-benefit evaluations, and
emphasizes the importance of maintaining liquidity and optimizing capital structures
to enhance overall profitability