Effect of Asset Growth Rate on The Financial Performance of Firms In Nigeria: A Multi-Sectoral Analysis

• Post by: birpo
• June 25, 2026
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Ogbodo, Charles Anibuike Ph.D¹ & Prof. Ikechukwu, I. Okpe²

Abstract         

The study examined the effect of asset growth rate on the financial performance of firms in Nigeria. The specific objectives were to ascertain the effect of total asset growth rate, non-current asset growth rate, and financial assets growth rate on the net profit growth rate of firms in Nigeria. The study adopted an ex post facto research design, utilizing historical financial data obtained from the audited annual reports of firms listed on the Nigerian Exchange Group between 2015 and 2024. The population comprised forty (40) firms across the Consumer Goods, Industrial Goods, and Oil & Gas sectors, from which a purposive sample of thirty (30) firms consistently listed as of 2015 was selected. Data were collected through secondary sources and analysed using panel estimated generalised least square regression analysis with the aid of E-Views software to test the formulated hypotheses. The findings revealed that: total asset growth rate has a negative and significant effect on the net profit growth rate of firms in Nigeria (β = -1.8376, p = 0.0014); non-current asset growth rate has a negative but non-significant on the net profit growth rate of firms in Nigeria (β = -0.3588, p = 0.2963);.The study concluded that strategic management of asset growth is essential for enhancing firm profitability and sustaining long-term financial performance in Nigeria’s competitive business environment. The study recommended that investment managers and corporate treasurers should review their portfolio of financial assets to ensure that funds are not tied up in low-yield or non-productive financial instruments. Redirecting excess funds toward core business operations or high-return projects can help enhance profitability and reduce the adverse effects of unproductive financial asset accumulation.

Keywords: Asset Growth Rate, Total Asset Growth Rate, Non-Current Asset Growth Rate, Financial Assets Growth Rate, Financial Performance

Cite: Ogbodo, C. A. & Ikechukwu, I. O.(2026). Effect of Asset Growth Rate on the Financial Performance of Firms In Nigeria: A Multi-Sectoral Analysis. International Journal of Accounting Research and Financial Insights,4(4), 279-298.https://doi.org/10.5281/zenodo.20784905