THE IMPACT OF RELATED PARTY TRANSACTIONS ON FINANCIAL PERFORMANCE OF LISTED DEPOSIT MONEY BANKS IN NIGERIA

Related party transactions (RPT) are transaction carried out between a company and another party that has a close relationship with it, either through ownership, control, or significant influence. This study is aimed at assessing the impact of related party transactions on financial performance of listed deposit money Banks in Nigeria. Data was collected through document review and extraction from relevant published financial statements of the sampled banks. The study adopts an ex-post facto research design because it employs historical financial data derived from published financial statements without manipulation of variables. From the data collected, results showed that Related Party Transactions showed a statistically negative and significant effect on ROA at 5% level of significance. Related Party Transactions also negatively affected ROE, although the effect was marginal and less significant. Bank Size exhibited a positive and significant influence on ROA and ROE, indicating that large banks benefit from economies of scale. The study recommends that Regulators such as CBN, SEC and NSE should intensify monitoring of RPT disclosures to ensure that transactions are carried out at arm's length and in the best interest of shareholders. Banks should improve transparency by providing detailed breakdowns of the nature, purpose and beneficiaries of related party transactions. Independent audit committees should rigorously review RPT disclosures to curb opportunistic practices.