Research Article

Anti-Money Laundering Regulation and Operational Efficiency of Deposit Money Banks in Nigeria

Dr. Solomon Reuben Irmiya1*, Winner Godwin1, Haruna, Judith Bana1, Gladys Izang John1, Dau, Justin John1, Daboer, Dominic Dadee1, Goma, Carol Alfred1, Adi, Donatus Dongnda1, John, Seun Ajani1, Magunni, Beatrice Watitik1
1 Department of Banking and Finance, Faculty of Management Sciences, University of Jos.
* Corresponding author: irmiyas@unijos.edu.ng
Published: Dec, 2025
DOI: 10.67862/jbfr.2025.b89aea7w
Pages: 20-31
Views: 61
Downloads: 40

Abstract

Given the high cost of operation faced by banks in Nigeria despite years of enforcement by regulators, the need to ascertain whether anti-money laundering rules add to or alleviate the burden becomes very essential. On the basis of this, this study examined the effect of anti-money laundering (AML) regulations on the operational efficiency of Deposit Money Banks in Nigeria. An ex-post facto research design was employed with a comprehensive secondary data gotten from the CBN Statistical Bulletin, NDIC Annual Reports, and Basel Institute on Governance Reports for 2012–2024. The Seemingly Unrelated Regression (SUR) technique was used to capture the multidimensional nature of the dependent variables: cost-to-income ratio (CIR), operating expense ratio (OER), asset turnover ratio (ATR), and return on assets (ROA). Preliminary analyses, descriptive statistics, as well as Augmented Dickey-Fuller unit root tests, and normality tests, were carried out using E-Views 10. The results showed no significant effect of AML regulations on CIR, OER, and ROA, but a significant positive relationship was found with ATR. While the research concluded that compliance with AML regulations is important, banks should further enhance digital banking adoption, investment strategies, and revenue-generating initiatives to achieve sustainable operational efficiency improvements.

Keywords

Anti-money laundering Asset Turnover Cost to Income Deposit Money Banks Operational Efficiency

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How to Cite

Irmiya, D. S. R., Godwin, W., Bana, H. J., John, G. I., John, D. J., Dadee, D. D., Alfred, G. C., Dongnda, A. D., Ajani, J. S., & Watitik, M. B. (2025). Anti-Money Laundering Regulation and Operational Efficiency of Deposit Money Banks in Nigeria. Journal of Banking and Finance Research, 1(1), 20-31. https://doi.org/10.67862/jbfr.2025.b89aea7w

D. S. R. Irmiya, W. Godwin, H. J. Bana, G. I. John, D. J. John, D. D. Dadee, G. C. Alfred, A. D. Dongnda, J. S. Ajani, and M. B. Watitik, "Anti-Money Laundering Regulation and Operational Efficiency of Deposit Money Banks in Nigeria," Journal of Banking and Finance Research, vol. 1, no. 1, pp. 20-31, December 2025. doi: 10.67862/jbfr.2025.b89aea7w

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