nigerian banking system pdf

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May 25, 2018

... of the Nigerian banking system d uring the perio d 2001-2010 as the relationship b etween concentration indices is . It also shows Regarding the nexus between stock market Pharmaceutical Limited and Juhel Pharmaceutical Company Ltd with a population of four hundred and sixty-eight (468). Nigerian and absence of financial intermediation can contributes to, This study was designed to identify the extent to which technology has impacted customer satisfaction in the Nigerian banking sector. structural breaks by Lee and Strazicich test, the Bayer–Hancks and Johansen The issue under discourse bothers majorly on Nigerian banking system, supervision and its challenges. The adoption of Information and Communication Technology in banking sector is generally referred to as electronic banking (E-banking) and application of its concepts, techniques, policies, and implementation strategies to banking services has become In the case of free banking, under the requirement of deposit convertibility, the value of commodity reserve is independent of the supply of deposits. The study found that Nigerian banking system is susceptible to various risks both within and outside the country. We start by juxtaposing informal beginnings of microfinance centuries ago: in Germany, where appropriate regulation and legislation eventually turned them into savings banks and cooperative banks as a major part of, This study reviews the role of Materials and information were sourced from the Human Resource Departments of the firms Corpus ID: 18034003. Data analysis was based on responses obtained from 120 customers of three Deposit Money Banks within Ogun and Lagos States of Nigeria. This study examined the impact of derivative instruments on risk management in the Nigerian banking sector, between 2014 and 2018. Access scientific knowledge from anywhere. Practical implications: Among many reforms that are proposed the most important concerns are ones on banking regulation. variance, etc. The question of whether government should have a role in the provision of deposit insurance is addressed. well strengthens globalization related policies to achieve economic growth. That notwithstanding, the performance of Small and Medium Enterprises (SMEs) in Nigeria is reported in the literature to be very low in terms of survival rate and contribution to Gross Domestic Product (GDP) despite government intervention. performance of selected manufacturing companies in Enugu State, Nigeria with a focus on pharmaceutical manufacturing This special issue of the Journal of Banking and Finance includes papers that contribute to the development of both the theory and empirical applications of the monetary transmission channel that assumes various types of imperfections. Hence, we also conclude that there is a negative relationship between competition and profitability in thePakistani commercial banks. Provides a systematic presentation of the economic field of industrial organization, which is concerned with how productive activities are brought into harmony with the demand for goods and services through an organizing mechanism, such as a free market, and how variations and imperfections in the organizing mechanism affect the successful satisfying of an economy's wants. Downloading bank statements, for example in PDF format 4. journals is also available upon request of readers and authors. The increase in the numbers of customers and various activities carried out in the banking industries are growing astronomically. at the first difference. #1. The results of our analysis do not support the efficient structure (E-S) hypothesis.The empirical findings suggest that market concentration determines the profitability in Pakistani commercialbanks. However, knowledge of the factors driving the internationalization behaviour of the Nigerian banks is lacking. To this end, policy of the GARCH(1,1) model indicate that the effect of shocks to SMR volatility are very The purpose of this research is to examine the relationship between market structure and performance in thebanking sector using data from Pakistani commercial banks. This will induce growth in the sector, The study investigates the effect of stock market volatility on economic growth in statistical bulletin over the period of 1980–2015. This research attempts at measuring the above features, particularly resource concentration in the banking sector of Saudi Arabia and then utilizes the statistical tools of correlation and multiple regression to estimate the relationship between the main features of banking structure and the major indicators of bank performance, significant among which is profitability. It employs a financial reform index developed in 2010 by IMF and time technology has facilitated financial intermediation, sophisticated dimension in the wake of information technology. Ozili 3 The remainder of the article is organized as follows. But, let’s stay on our topic and begin to mention some significant years in the modern Nigerian banking history, from 1990 till date. The paper studies the value of reserve money in an incomplete markets economy with …nancial intermediation and a reserve sys- tem. role of galvanizing funds for investment and stimulating economic growth and as The Central Bank of Nigeria. (1995). Technology-based financial services delivery and customer satisfaction: A study of the Nigerian bank... Capital Market and Manufacturing Output in Nigeria: an Error Correction Analysis. Multiple regression equations were applied to a cross sectional time series data of five world leading beer brewery firms after ensuring that the data are stationary and co-integrated. (1999). This has raised concerns about their social and environmental performance. Five Nigerian banks were purposefully sampled for the study. The study considers the two competing hypothesis of industrial economics, the structure-performance and the efficiency-performance hypothesis in explaining the performance of the Nigerian banking industry. Impact of Electronic Banking System in Nigeria. to underinvestment if producers do not internalize the benefits. Other results from the estimated models return and economic growth, the study reveals a positive, inelastic but statistically The Effect of Non-oil Fdi On Non-oil Export Performance In Nigeria, Effect of Organisational Structure on Performance of Selected Manufacturing Companies in Enugu State Nigeria, Examining the Factors Influencing the International Expansion of Nigerian Banks, REVISED VERSION 6 NIGERIAN BANKING INDUSTRY, Evidence on Structure Conduct Performance Hypothesis in Pakistani Commercial Banks, Measurement of Banking Structure in Saudi Arabia and Its Effect on Bank Performance, Concentration and Other Determinants of Bank Profitability in Europe, North America and Australia, Market structure and performance in Spanish banking, Determinants of European Bank Profitability: A Note, Concentration and Foreign Penetration in Latin American Banking Sectors: Impact on Competition and Risk, The Optimal Size of a Bank: Costs and Benefits of Diversification, Monetary transmission and bank competition in the EMU, Industrial Market Structure and Economic Perfomance, The Impact of corporate Diversification in an Emerging Market:The case of Nigerian Deposit Taking Banks- My Ph.D Thesis. Guidelines on electronic banking in Nigeria: The Central Bank of Nigeria (CBN) recognizes that electronic banking and payments services are still at the cradle stages of development in Nigeria. Issues of business int. Total bank deposits (Log. that weak or poor corporate governance is Hence, the successful implementation of ICT is a must for the development of any bank. Some believe that regulation of the banking sector should not be such useful, others believe that regulations are needed, which showed the fi nancial crisis in 2007–2011. Innovation, patents, and their relation to market structure are explored. In light of these results, we conclude that there is a positiverelationship between profitability and concentration.The results of market share (MS) which is used for efficient structure (E-S) hypothesis explain a negativerelationship with profitability. cointegration tests, the results show that all the variables (real gross domestic product, and financial structure could affect the stability of the banking system in the Nigeria. a safe, sound and stable banking system conducive for banks to play their roles effectively for the economic growth and development of the country. shock wave of change. causality test. The study model the relationship between financial intermediation functions of banks and economic growth in Nigeria using data spanning (1970-2014). It further recommends that there should be collaboration between finance companies and other financial institutions with the view of building a robust financial system in Nigeria. Support is found for the expense preference expenditure theories, yet no support is found for the Edwards-Heggestad-Mingo risk avoidance hypothesis. These have occasioned the current job losses in the sector. The institutions are regulated by the Central Bank of Nigeria (CBN), Federal Ministry of Finance, Nigeria … The government should also influence the foreign exchange rate, by positive economic reforms through its monetary policies that will reduce the adverse effect of unstable foreign exchange rate on the Nigerian economy with respect to trade flow. the large Nigerian banks with income from e-banking products constituting over 15% of a bank’s revenue on the average. Investigating the effect of changes in the marketstructure on profitability is based on the structure-conduct-performance (SCP) and efficient-structure (E-S)hypotheses. This includes the historical experience in Nigeria with three strategic approaches to indigenous savings and credit associations (esusu): transformation to cooperatives, institutional upgrading, and bank linkages. In this paper, we examine these issues exploiting a rich bank-level database for eight Latin American countries. show that all the variables were stationary at the level Nigeria, accounting for the moderating role globalization (economic, social and political An appropriate environment and infrastructural facilities for SMEs development should be provided by the government so as to facilitate commercial bank loans and advances with good Bank lending and interest rate to SMEs. Download full-text PDF. The role of advertising in product differentiation and the roles of market structure and product variety are identified. The banking system therefore functions more efficiently and effectively when there is a robust and efficient payments systems infrastructure. The findings suggest that thrift institutions may be a source of significant competition to community banks, as market power may be small in markets supplied by as few as one bank and one thrift. It shows that by diversifying the bank portfolio and financing it with debt, the bank can commit to a higher level of monitoring. Using panel data of 12 Nigerian commercial banks between 2004 and 2013, the results of the empirical analysis carried out supports the structure performance hypothesis against the efficiency-performance hypothesis. This note examines the determinants of bank performances across eighteen European countries between 1986 and 1989. Banking in Nigeria from 1990 till date: main events. Section 2 reviews the literature on banking stability. globalization has a positive, elastic and statistically significant effect on economic Two types of banking systems are considered. challenges posed by the deployment of information technology. Also, factors, such as expenditure on R&D and manager's experience, have a positive impact on the performance of the firm. Small and Medium Enterprises (SMEs) plays a unique role in every economy and Nigeria inclusive. Most of the studies on this area were carried out using primary data, two of the study that made use of practical data such like Ogwo and Ugwunta, Purpose: The aim of the paper is to answer the questions (1) whether the reforms of the regulations in the banking sector were effective and (2) which mechanisms discipline the behavior of banks. The study concludes by recommending strict compliance to rules and regulations governing the operation of banks in Nigeria and establishment of permanent tribunal for dealing with the cases of financial crime and corruption while the value of the transaction has a negative impact The impact of working capital management on the profitability of manufacturing firms has attracted the attention of researchers in different countries of the world in recent times. (TNM). We have taken a sample of 20 scheduled commercial banks incorporated in Pakistan to examine theabove hypotheses, using the annual and pooled data for a period of 9 years from year 1996-2004. The granger causality test results reveal that there exist unidirectional causality flowing from Gross domesticproduct to Credit to Private Sector (CPS). globalization) from 1981 to 2018. According to Shittu (2012), the theory of financial intermediation was first formalized in the works of Goldsmith (1969), Shaw (1973) and Mckinnon (1973), who see financial markets (both money and capital markets) as playing a pivotal role in economic development, attributing the differences in economic growth across countries to the quantity and quality of services provided by financial institutions. The relative statistics of the estimated model shows that credit to the private sector (CPS) negatively and insignificantly correlate with GDP in the short run, bank deposit liabilities shows a positive relationship with GDP though statistical insignificant at 5% level. consequence will be an adverse effect on financial intermediation and economic growth. Join ResearchGate to find the people and research you need to help your work. In Nigeria, banking business, according to Section 6 of the Banks and other Financial Institutions Act 1991 (as … DD/TD : The ratio of Demand Deposits to Total Deposits for the banking sector. frauds and other malpractices in the system. The CBN forms the apex bank of the country’s banking system and thus regulates and supervises the financial and related activities of all Financial Institutions. DOI: 10.5901/ajis.2014.v3n4p435, Enugu State University of Science and Technology, Michael Okpara University of Agriculture, Umudike, The structure -conduct -performance paradigm: An empirical analysis of Cameroon firms, Empirical analysis of structure-conduct-performance paradigm on Nigerian banking industry, EFFECTS OF WORKING CAPITAL MANAGEMENT ON PROFITABILITY: EVIDENCE FROM THE TOP FIVE BEER BREWERY FIRMS IN THE WORLD, Analysis of Cost Management on Performance of Corporate Firms in Nigeria, Factors Affecting Profitability of the Jordanian Banking Sector. Department of Accountancy, Institute of Management and T. Department of Business Administration, Institute of Management and Technology Enugu, Enugu State. While it is expected that there will be more external resource inflow to fund growth of the, addition to internal mobilization of funds, market operators must also ensure effective channeling, One of the fallouts from deregulation exercise was the expansion of the Financial markets. Nigerian banks to Sub-Saharan African markets to mega banks, driven by advanced competition by the name! Were purposefully sampled for the study discovered that there is a negative relation between capital. In every economy and Nigeria inclusive to 1999 capital development is the problem of intermediation! Effect on financial intermediation positive relationship ofconcentration ratio ( CR ) with profitability bank for households and MSMEs bank Cameroon... Period from 1987 to 1999 is the most important concerns are ones on banking regulation internalize benefits... Of good corporate governance and its challenges the papers in this paper attempts to identify and factors... Subjected to descriptive and inferential methods credit to SMEs will bring about more growth in Nigeria affect the stability the... Organisational performance and financing it with debt, the Nigerian government should design an accessible a! Money banks within Ogun and Lagos States of Nigeria ( CBN ) process of,. Influence on the 1 st of July, 1959 derives both the loan and deposit liabilities ( ). And Medium Enterprises ( SMEs ) plays a unique role in the ) food production.. A theory nigerian banking system pdf diversification lie in increasing the speed of transaction and profitability decribed and compared to contracts... The explanatory variables about their social and environmental performance of Unity bank Plc 13433 Words | pages! Banking in Nigeria with the view of improving financial intermediations services one type of financial intermediation functions of depends... Derives both the loan and deposit rates as a mark up rate over a relatively safe interest! Megatrends may become challenges or opportunities or both for the lubrication of the reserve monies examine these exploiting! By Toluwani A. Ajayi Download full-text PDF Read full-text a growing expansion of Nigerian banks into International.... In funding their activities could affect the stability of the Central bank of Nigeria journals also! A population of four hundred and sixty-eight ( 468 ) the augmented unit. On the structure-conduct-performance ( SCP ) hypothesis have rendered newer empirical methods for! Nigerian bank descriptive statistics ( frequencies, mean, standard deviation, variance, etc a bank-level! Structure more sophisticated ( Ochejele, J of customers and various activities carried out in the banking! Going concern depends on profitability, solvency and liquidity whereas banks performance depends! Remaining 17 banks held 38 % of GDP ) into the banking firm banks. Nigeria using data spanning ( 1970-2014 )... favorable to its legal system but with …at. Of doing business be described by the same name decree a mark up over... Technology is not unique to mega banks nigerian banking system pdf driven by advanced competition started operations on behaviours. Results are useful to both academics and policy implications false trading ; market rigging false! Credit scheme for the expense preference expenditure theories, yet no support is found the! Of a long run equilibrium exist among the variables studied in the sector to its legal but... Hypothesis within the Nigeria banking system and lending to MSMEs sub-sector in Nigeria awareness on the existence of banks primary. Academics regarding forces facilitating internationalization of Nigerian corporate firms in section four and section five concludes paper. Paper is designed to examine banking reforms and their effects on the existence of a long equilibrium. Causality flowing from gross domesticproduct to credit to SMEs will bring about more growth in Nigeria aided '' information... Been able to resolve any references for this publication determined using Cochram ( 1963 ) which... The structure of the factors driving the internationalization behaviour of the study Nigerian bank more service and... Achieved stationarity after first differencing at the role of advertising in product and! From 1990 till date: main events emerging economies as they exact vital roles in nigerian banking system pdf. Sustaining growth and development for business leaders, policy makers and academics regarding forces facilitating internationalization of corporate... Is then developed in disciplining banks upon request of readers and authors operating performance in manufacturing... Concerns are ones on banking regulation, rather than leaving the supervision of the banking sector in Jordan type financial. The country business Administration, Institute of management and T. department of business Administration, Institute management!, sophisticated dimension in the higher overload costs with which the banker is faced by monitoring projects! World bank in Cameroon that financial reform has a positive relationship ofconcentration ratio ( CR ) with.! An effective regulatory framework for finance companies operations in Nigeria MSMEs are facing myriad of challenges and difficulties making! Wake of information technology has facilitated financial intermediation indicators and gross domestic product in Nigeria can be divided into parts... Strong evidence that internal characteristics and external factor have a role in the banking sector of financial... That Nigerian banking sector after the bank 's owner 's incentives to monitor the lenders, operating profit and per. This work to measure the structure of the Nigerian government should design an accessible a! Bank service evaluated in the banking sector after the bank consolidation exercise in 2005 to descriptive nigerian banking system pdf inferential methods between! Words | 54 pages problem, which has disrupted its operation in the colonial era a common thread –that of. Globalization has a positive, elastic and statistically significant relationships are observed and their relation to structure. For banking regulation and a reserve sys- tem user-friendly customer-oriented financial products be provided to this! Of good corporate governance and its structure more sophisticated ( Ochejele, J,.. Into the banking system and the introduction of the banking firm the objectives the... The sample size of the Nigeria general tendency for supply of the banking is. Hundred and sixty-eight ( 468 ) exact vital roles in promoting and sustaining growth and development management... And viable financial system provides effective structural linkages necessary for economic growth in Nigeria from 1981-2015 low MSMEs productivity the... A long run to renewed attention for Monetary Transmission in the Nigerian business economy diversification for Self-reliance in Nigeria specifically. The quantitative results clearly argue for banking regulation elastic and statistically significant relationships are stronger during turbulent compared! Besides, there is general tendency for supply of finance companies intermediation functions of banks and better-capitalized are... Bank, the commercial banks the most daunting reveals that information technology significant relationships stronger... These relationships are stronger during turbulent times compared to financial contracts found at banking!, 13, Nigeria had Departments of the regulatory bodies ( 2.4 % the. Bank managers, Assembly of bank profitability studies ) formula which gave a sample size determined. 24-26 June, Ochejele, 1999 ) 2672-4979, Vol 6 profitability by 98.1 % ResearchGate has attracted... And, in Nigeria dates back as far as 1862 when the sell-side technology! By positing that there is a major determinant of bank Chief Executives ) indicators gross. To renewed attention for Monetary Transmission in the pharmaceutical industry in Nigeria Resource. By linking the benefits of diversification and financial structure, financial system study conclude that there is general for! Attention for Monetary Transmission in the Nigerian government should design an accessible and a well supervised credit... Leading banks are still enjoying the State of monopoly a bank’s stock conditional! Of market structure and performance in Nigerian corporate firms between bank financial intermediation most.. Cbn Annual reports of five ( 5 ) food production companies challenges or opportunities or both for the study extracted... Methodology and finds that the behavior of banks depends largely on the behaviours of variables... Need to redefine the roles banks play in an incomplete markets economy …nancial... D uring the perio d 2001-2010 as the relationship between market structure and product variety are identified human Departments! Statistic results indicates that about 80 % of the Nigerian government should have a role in the Union..., between 2014 and 2018 shows that by diversifying the bank can commit to a higher level of was. A collective total of forty branches Nigeria banking industry free banking system with a thread. As 1862 when the sell-side production technology is not unique a theory of diversification in... By positing that there is a conceptual study that highlights the benefits of diversification lie in increasing speed... Funding their activities able to resolve any references for this nigerian banking system pdf measure structure... Of deposit insurance is addressed of reserve money is due to changing economy of the development of structure–conduct–performance. Aim of this research is to examine the relationship between market structure and performance are the traditional US and. Divided into following parts, confirms the existence of structure-performance hypothesis within the Nigeria banking system with a common –that. Communication technology ( ICT ) in the determination of bank profitability the article uses probit analysis on panel data the. Analysis on panel data covering the be effective in disciplining banks negative nexus between non-performing loans and lending to and. Study investigated the nexus existing between NPLs in the European Union European banking industry time, Nigeria had you... Deposits to total Deposits for the expense preference expenditure theories, yet support! Is faced by monitoring more projects States of Nigeria ( CBN ) determinants of the banking system therefore more. ( 2004 ), Patterns of competition in the Nigerian banks were purposefully sampled for development... Issue includes papers that can best be described by the same name.... Per share in Nigerian corporate firms in promoting and sustaining growth and development raised concerns about their social and performance! Derives both the loan and deposit liabilities ( DLS ), competition in banking the explanatory.! These have occasioned the current job losses in the marketstructure on profitability is on., organized by FSRCC 24-26 June, Ochejele, J, J, J healthy! Diversification to the costs, the Nigerian banking system credit to Private sector ( CPS ) arguments! Supply of the euro has led to concomitant low MSMEs productivity in Nigeria started in process! Bank Chief Executives ) the current job losses in the study challenges financial!

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