IMPACT OF IFRS 9 IMPLEMENTATION ON THE FINANCIAL PERFORMANCE OF DEPOSIT MONEY BANKS IN NIGERIA (DMBS)

This research examined the effects of the implementation of IFRS 9 on the financial performance of Deposit Money Banks (DMBs) in Nigeria, specifically concentrating on the Expected Credit Loss (ECL) model. The study investigates the effect of ECL on Return on Assets (ROA), Return on Equity (ROE), and Earnings Per Share (EPS). It uses secondary data that is the audited financial statements of five major banks, namely Access Bank, Zenith Bank, GTCO, UBA, and First Bank, between the years 2015 and 2024. By employing an ex post facto research design alongside multiple regression analysis, the research evaluates whether IFRS 9 has had a significant impact on these essential profitability indicators. The empirical results reveal that the ECL model has a statistically significant negative impact on ROA (β = -0.211, p = 0.038) and EPS (β = -0.187, p = 0.044), while its effect on ROE is negative but statistically insignificant (β = -0.145, p = 0.212). These findings suggest that although IFRS 9 enhances transparency and risk sensitivity, it places pressure on profitability due to increased credit loss provisioning. . Evidences gathered from the theoretical and empirical studies indicate that while IFRS 9 improves the transparency of financial reporting and enhances risk management practices, it also leads to increased volatility in profit metrics due to more enhanced credit loss provisioning standards. This study contributes to the expanding body of literature by providing contextual insights from an emerging market and provides meaningful implications to bank regulators, investors, and accounting professionals. The conclusion drawn from the study is that despite the challenges posed by the implementation of IFRS 9, it holds the potential to bolster financial reporting standards and enhance investor confidence within the Nigerian banking sector. Keywords: IFRS 9, Expected Credit Loss, ROA, ROE, EPS, Deposit Money Banks, Nigeria, Financial Performance.