A Study to Examine The Additional
Strategies Developed by Nigerian
Development Finance Institutions to Ensure
Long-Term Financial Sustainability Between
2017 and 2021

ABSTRACT

Development Finance Institutions (DFIs) are universally charged with providing financing to growth sectors in their respective jurisdictions. The Nigerian government since 1964, has set up several DFIs, some of which were unable to perform optimally, despite this, there have been attempts to restructure them into more commercially oriented enterprises. This study aimed to identify and explore the additional strategies that the Nigeria DFIs have developed to ensure long run financial sustainability between the periods of 2017 to 2021. It examined a quantitative approach to measuring the financial sustainability of Nigerian DFIs using different metrics, empirically, the impact of the adoption of the wholesale model, the implementation of institutional safeguards, and the influence of political interference on corporate governance on long-run financial sustainability. The results identified that (1) the wholesale model has had a positive impact on financial sustainability indices like the NPL, CAR, ROE, and SDI from 2017 to 2021, (2) several respondents believed that Corporate Governance and Institutional Safeguards are directly related to financial sustainability. The study results showed that to ensure long run financial sustainability by Nigerian DFIs, effective corporate governance and the implementation of institutional safeguards underpinned by a business model that works (the Wholesale model) are important.

Keywords: Development finance Institutions, Wholesale DFI Model, Retail DFI Model