CAPITAL MARKET GROWTH AND EQUITY FINANCING OF QUOTED SMALL AND MEDIUM SCALE ENTERPRISES IN NIGERIA
AKANI, Henry Waleru
Department of Banking and Finance, Faculty of Management Sciences,
Rivers State University, Port Harcourt, Rivers State, Nigeria
henryakani@yahoo.com
ABSTRACT
This study examined the effects of capital market growth on equity financing of quoted small and medium scale enterprises in Nigeria. In carrying out this research, a panel data was used with the adoption of ex-post facto design. Secondary data were extracted from the annual reports and accounts of the ten quoted small and medium firms for the period 2009 to 2018. The study has equity capital of small and medium scale enterprises as the function of market liquidity, transaction cost, and market turnover and market size. The study found that market liquidity and market size have positive and not significant effects while market turnover and transaction cost have negative and not significant effects on equity financing of quoted Small and medium scale enterprises in Nigeria. We conclude that capital market have no significant effect on equity financing of quoted small and medium scale enterprises. There need to set up a system to ensure that small and medium scale enterprises comply with regulatory requirements cum compliance with regulatory requirements should be monitored more closely. A special team for direct monitoring of small and medium scale enterprises compliance could be set up. However, proportional and lighter regulation for small and medium scale enterprises does not mean that supervision should also be lighter for small and medium scale enterprises.
Keywords: Capital market growth, equity financing, market liquidity, transaction cost, market size and market turnover