Effect Of E-banking On Bank Profitability
[A STUDY OF GUARANTY TRUST BANK PLC ENUGU]

SUMMARY OF FINDING, CONCLUSION AND RECOMMENDATION

5.1     Summary of Findings

1. Internet banking has no significant impact on Return on Asset
2. Internet banking has no significant impact on Return on Equity
3. ATM transactions has no significant effect on Return on Equity

5.2     Conclusion

This study investigated the returns on equity and returns on assets of Guarantee Trust bank following the adoption of electronic banking in Nigeria. Nigeria is a developing country advancing in the use of electronic banking for its banking operations in comparison with other African countries. With high level of e-banking fraud, some customers feel discouraged with the use of Automated Teller Machines (ATM), an electronic banking product. 

This study has provided evidence that electronic banking has not improved returns on the equity and return on assets (ROA) of GT bank. As revealed by the empirical results, this study does not suggest that the adoption of e-banking is an investment in futility; rather it helps to satisfy customers’ appetite for improved service delivery and convenience. The unimproved returns may have arisen from the high cost of maintenance of equipment, software and training of personnel.

Electronic banking is cost intensive and will improve on total profitability performance in future as incidence of banking fraud caused by electronic facilities reduces and as well as the assets get older. The study encourages the use of electronic banking system based on its enormous benefits to the bank management, customers and the regulatory authorities.

5.3     Recommendation

This study therefore recommends the following given above findings.

1. The banking industry should adjust to full and effective deployment of information technology due to its sophistication since the technology is irreversible with relative perceived advantage.
2. The Nigerian banks should be able to accept the level of risk that they can cope with in electronic banking system, measurable to the bank’s overall strategic business plans. Though there is inherent risk for not adopting e-banking.
3. Banks should be able to provide adequate security both physically and electronically to check the incidence of hacking by fraudsters. Network hackers successfully dupe banks of billions of naira at a strike and can send banks into liquidation.
4. Holders of banking transaction cards should be able to secure them by providing passwords that meet international encryption standards
5. Shareholders of banks should exercise patience with the banks’ management in the payment of dividend as perceived future dividends will be fatter after some lag period of cost recovery. 
6. The banks management should from time to time train customers with regard to electronic banking, its benefits, and risk exposure, physical and electronic security to avoid financial loss in the hands of hackers.
7. Also, trainings should be held for bank staff in short periods to acquaint them with modern developments of the sophisticated technology in changing times.