Paper Title
Determinants of Dividend Payout Ratio In Sub-Saharan Africa Banks: The Panel GMM Approach
Abstract
This study adopts the dynamic panel two-step System and DifferencedGMM in analysing the data of 250 commercial banks from 30 countries in sub-Saharan Africa(SSA) for the period 2006 to 2015 to examine the determinants of the dividend payout ratio of these banks. The empirical results reveal that;past year dividend is the most significant determinant of current year dividend. Taxation and capital adequacy ratio are found to be insignificant. Our findings reveal earnings-after-tax and leverage asbeing significant determinants of payout ratio in SSA banks. Hence,Lintner’s model holds in SSA banks as a region.
Keywords - Lintner Model; Payout policy; Agency cost; Capital Adequacy
JEL Classification - G21; G35.