The need for financial stability and the ability to withstand financial crises due to ongoing fluctuations in foreign exchange rates have prompted an assessment of how foreign exchange risk management structures impact the capital adequacy ratio of deposit money banks with international authorization in Nigeria. This study utilized both survey and ex-post facto designs, focusing on the seven deposit money banks licensed for international operations. A sample of 296 staff members involved in foreign exchange trade and related functional units from these banks was studied. A regression model was employed to test the hypothesis. The findings indicated that the foreign currency risk management structure significantly affects the capital adequacy ratio of the selected banks in Nigeria. Consequently, it is recommended that deposit money banks in Nigeria enhance their foreign exchange risk management strategies. They should implement robust management information systems, develop contingency plans, and apply various managerial and analytical techniques to address all forms of foreign risk exposures and transactions. Additionally, banks should consider utilizing other hedging instruments to mitigate their foreign exchange risk exposures.
