BANKING AND FINANCIAL DEREGULATION IN A DEVELOPING ECONOMY. A STUDY OF THE CENTRAL BANK OF NIGERIA (C.B.N.).
BANKING AND FINANCIAL DEREGULATION IN A DEVELOPING ECONOMY. A STUDY OF THE CENTRAL BANK OF NIGERIA (C.B.N.).
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Date
2002
Authors
IDRIS, ABUBAKAR
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Abstract
The Financial Institution in general and banking
syetew in particular have always been Important in
any economy. Banks generally serve as intermediary
between the savers and investors in channelling fund,
In order to f a c i l i t a t e business transactions and
economic development. The Government directs and
regulates the a c t i v i t i e s of the banks since the
establishment of the Central Bank of Nigeria (CBN)
in 1959.
The regulations becomes necessary to ensure the
continued soundness of the system and thereby minimising
the risk of bank failures. Also to ensure that banks
products are available to various sectors of the economy
and to minimise misuse or fraud that could have serious
impact on the public confidence and hence on the
economy.
Inspite of the excessive regulations and control
the Nigerian Economy s t i l l depressed. To the extent
that people begin to wonder if the excessive regulations
and control could revive a depressed economy, this could
have happened in the period preceeding SAP.
In order to remove or minimise these distortions
policy makers often resorted to economic deregulation.
Deregulating the Nigeria banking system began in
J u l y 1986, when the Federal Government adopted SAP
with economic deregulation as one of i t s cardinal
objectives.
The period of SAP represents the period in which
far-reaching monetary policies were Introduced
according to the CBN credit guidelines. The policies
were basically the moderation of inflation rate
reduction of resource on balance of payments
establisation of the exchange r a t e and increse in
financial saving investment employment and growth.
This research examined the impact of deregulation
of the banking system on the Nigerian economy, the
CBN regulation policies on the banking Industry prior
to adoption of SAP and the number of policy measures
adopted by the CBN on the banking industry during the
SAP e r a.
The study found that financial deregulations
has brought in i t s wake monumental chances, upheavals
and challenges particularly impact on customer
services proliferation of banks encouragement of
domestic saving and efficiency of the banking
system increased others include rate / v o l a t i l i t,
little investment in productive sector low foreign
investment, fraud forgeries labour turnover
and shortage of long term c a p i t a l like the Nigerian
banking environment.
The study suggested that "banks have to accept
that the business environment has changed and will
continue to change and only the i n s t i t u t i o n s that
are able and willing to make the tough decisions and
sacrifices necessary to become flexible, efficient
and productive will survive
Description
A PROJECT SUBMITTED TO THE POSTGRADUATE
SCHOOL, AHMADU BELLO UNIVERSITY, ZARIA IN
PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR
THE AWARD OF THE DEGREE OF MASTER IN
BUSINESS ADMINISTRATION.
DEPARTMENT OF BUSINESS ADMINISTRATION
FACULTY OF ADMINISTRATION
AHMADU BELLO UNIVERSITY
ZARIA.
Keywords
BANKING,, FINANCIAL,, DEREGULATION,, DEVELOPING,, ECONOMY,, STUDY,, CENTRAL BANK,, NIGERIA