ASSET ALLOCATION AND FINANCING INTENSITY IN A SHARIA COMPLIANT BANK: EVIDENCE FROM JAIZ BANK PLC

This study examines the impact of asset allocation on financing intensity of Jaiz Bank Plc in Nigeria within the period of quarterly data from second quarter of 2016 to first quarter 2026. The study is a correlational research design which uses secondary data gathered from the published financial statements of Jaiz Bank Plc. Data analysis was done using Autoregressive Distributed Lag (ARDL) model. The results show that there is a long run equilibrium relationship between the variables. The Cash Holding Ratio in the long run has a significant negative effect on financing intensity, whereas the Equity Ratio has a significant positive effect. In contrast, the Investment Allocation Ratio and Deposit Ratio have negative, but not statistically significant, effects. The changes in the Investment Allocation Ratio and Equity Ratio have considerable impact on financing intensity in the short-term period, and the phenomenon of error correction term shows that the short-term shocks are quickly corrected by about 78.3% in the long run. The study concludes that strategic asset allocation is an important financial management tool that influences financing intensity in Jaiz Bank Plc. It recommends that the Bank must have an optimum cash holding policy, build up the equity base of the bank, review investment allocation policy on regular basis, and efficiently utilize the deposits of the customers to optimise financing activities and sustain financial stability in the long run without compromising liquidity and capital adequacy.