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.