Abstract

The impact of liquidity management on the performance of commercial banks in Nigeria was analyzed to ascertain the effect of liquidity on profit after tax of banks. return 1111 asset and then it effects on return on equity. The study adopted the use of econometric analysis using simple regression analytical techniques and secondary data which was extracted from annual reports of first bank Nigeria Ple from 2001 to 2015. Regression analysis find the relationships between variables for the purpose or predicting 1·u111rL· values. From the result of the study. the relationship between liquidity managcmL"11I in banks and their profit revealed that there is a positive and signilicant relationship between profit after tax and liquidity management of banks in Nigeria. This is seen from the R square of .545 (54.5%) of the total variations on profit after tax of hanks which is attributed to variations on liquidity management in the banks. lhe simple n:gr1.",-..1, 1 11 result on the independent variable which is liquidity management and the dependent variable which is return on asset shows that liquidit~ management has no :-.igniti .. 1111 effect on the return on assets of banks in Nigeria. Which is shown from the t-s1a1i,1i1.·, value of -1.197 (which has the probability value of 25.6%).From the adjusted R squ.111." ,ii 23.37% of total variation on return on equity resulting from variation in liqudty management in banks. I-knee, liquidity management has no significant effect on n.:luni , ,,, equity of banks in Nigeria.The following conclusion were drawn from the linding. 1h,.-1 ... is a positive and significant relationship between profit after tax and liquidity management of banks in Nigeria. liquidity management has no signilicant dTcct 111\ tl1-.: return on assets of banks in Nigeria and finally. liquidity management has no significant effect on return on equity of banks in Nigeria. Hence bank mangers should control liquidity risk factors by balancing cash inflows and cash out tlows. Bank rc.::g.11b1,,, ~ bodies should create polices that will help in improving. and elimination of loop holes in banking sectors.