REFORM IN THE COMMERCIAL BANK SYSTEM: COST AND BENEFIT 1995 – 2013

BY
…………………….

A PROJECT SUBMITTED TO THE DEPARTMENT OF BANKING AND FINANCE, SCHOOL

OF FINANCIAL STUDIES, FEDERAL POLYETCHNIC OKO.

IN PARTIAL FULFILMENT OF THE REQUIREMENT FOR THE AWARD OF NATIONAL

DIPLOMA ND IN BANKING AND FINANCE

NOVEMBER 2021

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APPROVAL PAGE

This project is approved by the department of banking and finance school of business and
management technology, federal polytechnic Nekede Owerri.

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N.O.N Kanu Date
(Project Supervisor)

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N.O.N Kanu Date
(Head of Department)

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External Supervisor Date

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DEDICATION
I dedicate this project to Almighty God, the Author and finisher of life

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ACKNOWLEDGEMENT
There are responsible individuals I’ll like to pay respect to for their moral, financial, academic
and otherwise support during of surgeon for this project.
First, I’ll like to express my gratitude to my supervisor Mr. N.O.N kanu who was
always there to see that corrections where made on each chapters I presented to him and
also my H.O.D N.O.N who read and approve this project.
Secondly, there are those that took this project upon their shoulders, stamp their feat
to the grand said to me, until we see that your pen is off your book we will always be
watched your back. This people include my ever promising and loving Mother Monica
Ugwuegbu my brothers, Chijioke, Ulumma, Ogechi, and also to my loving and caring friend
Sunshine for his love and care towards me during this project. I’ll never forget my uncles,
Mr. Kenneth.
Finally to my friends, who always stood by me in times of difficulties to encourage my
effort and discourage all forms of discouragement, they are Maureen, Ogechi, Ugochi etc.

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 TABLE OF CONTENTS
Cover page
Title page i
Approval page ii
Dedication iii
Acknowledgement iv
Table of content vi
Abstract ix
CHAPTER ONE
1.0 Introduction 1
1.1 Background of study 1
1.2 Statement of the problem 10
1.3 Objective of the study 11
1.4 Research Question 12
1.5 Significance of the study 13
1.6 Scope of the study 15
1.7 Definition of terms 15
CHAPTER TWO
2.0 Review of related literature 19
2.1 A brief introduction 19
2.2 Models and theories relevant to
the research questions 20
2.3. Current literature based on the variables
of the research question 25
2.4 Summary of the literature review 29
CHAPTER THREE
3.0 Research Methodology 31
3.1 Design of the study 31
3.2 Area of the study 31
3.3 Population of the study 32
3.4 Sampling technique 32
3.5 Source of data 34
3.6 Instrument for data collection 35
3.7 Validity and reliability of instrument 36
3.8 Distribution and retrieval of instrument
for data collection 36
3.9 Method of data analysis 37
CHAPTER FOUR
4.0 Data presentation and analysis 38
4.1 Introduction 38
4.2 Findings 44
4.3 Discussion of the findings 45
CHAPTER FIVE
5.0 Summary, Conclusion and
Recommendation 48
5.1 Summary 48
5.2 Conclusion 49
5.3 Recommendation 51
5.4 Limitation of the study 52
5.5 Suggestion for further research 53
References 54
Appendix A 56
Appendix B 57

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 ABSTRACT

The research work centered on Reform in the commercial bank system: cost and benefit
1995 – 2013. The problem of the study are: How will the Nigeria Banking sectors create
employment for the unemployed and the ways in which banking sectors control and
consolidate aggressive marketing? The researcher wishes to look into the following objectives.
To create employment for the unemployed at the long run in the banking sectors and to
consolidate the banking sectors and control aggressive marketing. The researcher used
percentage method as the instrument for data analysis. The major findings of this study are
as follows: it is found that reform have related affection on the level of unemployment by
creating employment opportunities. It is also found that banking sectors can control and
consolidate aggressive marketing by providing regulatory authority. As a result of the
findings of the study, the researcher made the following recommendations; Bank should
ensure extensive training and orientation of staff, which is necessary for the growth of bank
in future development of banks in Nigeria and, there should be enthronement of efficiency in
the delivery of services through improvement of technology in the banking system.

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CHAPTER ONE
1.0 INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Banking sector reform had been as old as its existence of banking, the essence of the
form is to move the sector from had condition to an improved or better condition by
eradicating faults, many nations of the world had reforms their banking sectors. Example is
India 1990s perform prior top gulf crisis of 1991, bank of England (the central bank of the
U.K) central bank of Japan, Central bank of Nig (CBN) since bank have been identified as a
very vital element of industrial and economics development have reform their banking sector
and tailored the operational structure and services of these institution to meet their
economic.
Just as blood is the life wire of every human so as banking and financial sector is to
every country’s economy and need to be harnessed so that it will bringout the best expected
from it. By the year 2004, banking system in Nigeria had eighty nine (89) banks and many of
which have capital base of less than $ 10 million U.S.A. This chapter set out some of the
factors that necessitated the need for banking sector reform through their financial
intermediation supposed to facilitate capital formation and promote economic growth by
operating in a safe sound and conductive environment. In the past, some efficient flow of
funds within the economic system. The sharp practices of some banks together with the
unsoundness of this led to a widespread of financial sector distress and losses to depositors.
Other problems include weak corporate governors guidance by high turnover in the
board and management staff, in accurate reporting and non-compliance with regulatory
requirement, late or non publication of annual accounts that obviates the impact of market
discipline in ensuring bank soundness, gross insider a base resulting in huge non-reforming
insider related credits, insolvency as evidence by shareholder funds that had been completely
eroded by operating losses.

Lack of autonomous, central bank which necessitates government interference in the

policy making to promote and control the soundness of banking and finance sector landed
the regulatory authority to make policies this will favour government and financial sector.

Poor capital base of bank which make many banks happened to have abandoned their
essential intermediation role of mobilizing, saving and alleviating banking habitat the house
hold and macro-enterprises levels, distribution of public funds was not uniform, there were
some banks whose dependence on the ratio was in excess of fifty percent (50%) the
implication were that the resources base of such banks become weak and rendering their

3
operation highly to the saving revenue of the government rising from the uncertainties of the
international oil market. In tackling the issue, CBN will not withdraw the license of the bank
that may not meet up with the raw requirement but they will be excluded from holding
public funds and participating in the Dutch Actions system. In dealing with issue to
reposition banking sector, the CBN decided that at the end of December, 2005 the name of
banks that meet up with a minimum capital base of 12 million naira as stated would be
published. The ideal is to enable potential depositors have enough information about the
status of the banks.

Banks have since complied with the CBN pronouncement by taking active and positive
steps towards increasing their capital base to handover the required minimum of 25 million
naira. The economy witnessed the signing of Memorandum Of Understanding (MOU) among
groups, expressing their intentions to merge as single banks, and also the signing of more
between two or more banks, one expressive their intentions to acquire the others as outcome
of reforms in the commercial section.
However, the primary objective of the reform was to guarantee an efficient and sound
financial system. There is need to reposition the banking sector with view to developing the
requisite flexibility to support the economic development of the nation. The reforms sought to
ensure a diversified, strong and reliable banking industry where there would use safe of
depositors money so that bank can play active development roles in the Nigeria economy.

The emergence of professor Charles Chukwuma Soludo as CBN Governor, he rolled

out innovation action programme the most prominent beings the banking sectors reform of
all reform agenda the issue of increasing stake holders fund to 25 million generated so much
controversy especially among the stakeholder and the need to comply before 31 st December
2005, most people have expressed concern that there capitalization has not resulted in a
significant improvement in banking service delivery. But there capitalization banking
environment is likely to be one of the level playing ground where equal ignorantly alter the
structure of competition in the industry (Soludo Charles 2004) will be the current reform
results on the desired positive charge in Nigeria economy. Yes in the long run, it will, the
banking system will be strong, sound competitive and reliable and will be equity
management, improve profesionalization and profitability etc.

Revelations from the C.B.N banking sectors reform points to the fact that some
commercial bank engage in unwholesome some financial practice such as granting of loans
with out collateral security, over budgeting and other sharp practice such as money
laundering for big business and politicians some of these ill are perpetrated with the profit
motive in mind and these unethical practice negate the rules and regulation of banking.
Based on this, the current CBN governor Sanusi Lamido Sanusi on his reform swept away
chief executive of five commercial bank in Nigeria in one fall swoop, the decision took many
Nigerian by surprises. It drew diversification some people applauded the action as be lated
but necessary to bring sanity to the Nigeria banking sector, other chastised the apex bank
boss for taking a decision that would turn around to hurt not only the bank, but the entire
Nigeria economy. The unprecedented panic withdrawals by customers of the respective
bank. Defied bail out funds and the assurance that it guarantee the liability the effected
banks.

1.2 STATEMENT OF THE PROBLEMS

Critically examining the nature of Nigeria’s financial sector challenges. Argument have
been raised on the way and manner in which reforms are being carried out by Lamido
Sanusi the Central Bank of Nigeria (CBN) Governor, whose actions have been regarded as
playing a one man show in a disintegrated gathering (Ayo, 2010).
Regulatory agencies empowered with the task of monitoring the affairs of financial
institutions have relaxed resulting to less transparency in financial records, inefficient
operations and ultimately fraud and other unethical practices.

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 The government has adopted aimed at achieving specified objective such as; interest
rate ceiling and selective sectorial policies. Those policies were introduced with the intention
of directing credit to priority sectors and securing “inexpensive” funding for their own
activities (Fry, 1998). The ceiling on interest rate and quantity restriction on loanable funds
for certain sectors ensures that a larger share of funds is made available for favoured sectors
hindering financial intermediation since the financial market will only be accommodating the
credit demand of the government plan and ignoring risks.
Poor performance of the money deposit banking, this is because of lack of uneducated
people working or employed in a bank.
Lack of employment in Nigerian Banking Sectors.

1.3 PURPOSE OF THE STUDY

In the light of the economics depression and bank crisis facing the economy presently,
the research work is aimed at providing information on how reform of banking can.

1. To create employment for the unemployed at the long run consolidate the banking sectors
and control aggressive marketing.
2. To consolidate the banking sectors and control aggressive marketing.
3. To reduce high interest rate and high credit to the industrial sectors.
4. To seek possible ways of improving the performance of he money deposit banks.
5. To push the economy towards economic globalization and liberation in the banking
sectors.
6. To improve the banking strategies and services in the economy.

1.4 RESEARCH QUESTIONS

1. How will the Nigeria Banking sectors create employment for the unemployed?
2. In what ways will the banking sectors control and consolidate aggressive marketing?
3. How will the problems of high interest rate and high credit to the industrial sectors be
reduced?
4. In what ways will the poor performance of the money deposit banks be restructured?
5. In what ways will the economy be pushed towards the economic globalization and
liberation in the banking sector?
6. How will the banking strategies and services in the economy be improved?

1.5 SIGNIFICANCE OF THE STUDY

The research work on completion will try to provide an answer to the cost and benefit
for reform in the Nigeria banking sector and financial institution. The impact of the residence
economy and the international organization of large. It will be of benefit to the government
and also tot eh public.
Government will be able to see the need through the research work increase in
subvention to the banking industry to increase their investment.
Furthermore, the result of the research work will form a base for the research on
commercial bank calculated problem and prospects.
Public will benefits from this research work since it will enhance equitable distribution
of banking facilities industries and other social facilities thereby increasing the standard of
living of people.
Finally, through this research work, people will know the problem and the prospect of
the banks and ways to eliminate such problems.
1.6 SCOPE OF STUDY
This scope of this research work will cover banks and financial institution, especially
money deposit bank with Nigeria from 1995 – 2013 using Ecobank in Nnewi as a case of
study.

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1.7 DEFINITION OF TERMS
REFORM: Solution or remedies adopted to change from bad conditions to an improve
or better condition by eradicating faults for suitable bank operation
effectiveness and efficient enhancement.
BANKING: In general term, this is the business activity of accepting and safe-guarding
money owned by other individual and entities and then lending out this
money in order to earn profit.
FINANCE: A branch of economic concerned with resource allocation as well as
resources management, acquisition and investment.
CONSOLIDATION: This combination of two or more banks into a new bank. In which
all banks are legally dissolved and new banks created.
MERGER: The combining of two or more entities into one, through a purchases
acquisition or a pooling of interest, here the entities concern will have
similar interest, product and objective.
ACQUISITION: Acquiring, control of a
Corporation called a target, by stock purchase or exchange, either hostile
or friendly there the acquiring firm retains its identity and the acquired
firm lease to exist.
ECONOMY: Can be defined as the structure
Of economy life of a country are or system.
COMMERCIAL BANK: An institution that provide a range of financial service,
including acceptance of deposit and granting of loans and advance. Here
has the large group of depositories with broad asset and liability powers.
CAPITAL: Ownership interest in asset consisting of the original and subsequent
invested funds plus retained profit sources of long term finances that are
available to the business firm and all man made reproductive assets.
SECTOR: Is a part of an area of activity especially of a country economy. The
manufacturing sector and service sector.

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CHAPTER TWO
2.0 REVIEW OF RELATED LITERATURE
2.1 A BRIEF INTRODUCTION
Banking reforms are often seen as solution or remedies adopted to change from bad
condition to an improved or better conditions by check-mating malpractice and effectiveness.
There has bee a great deal of emphasis on using existing tools to make the system safer.
However, the report is doubtful about how far evolutionary reforms can make
sufficient change. It is clear that many financial companies could and should improve their
risk monitoring and their management but judgment will always play a role and error is
always a possibility whether, it is by firm or regulation. Thus, the possibility of the failure of
a bank on number of banks always remains. In 2008, between 1 st and 8th October the Bank
of England (Central Bank of UK) loaned 61. 6 million pounds to the Royal bank of Scotland
and HBOS when the two leading banks ran into troubled waters.

2.2 MODELS AND THEORIES RELEVANT TO THE RESEARCH QUESTIONS

Banking sector reforms under professor Charles Soludo and Malan Sanusi Lamido
Sanusi.
Soludo the former Governor of Central bank of Nigeria (C.B.N) has show himself to be
a revolution list for six months in 2004, he grabbed all the headlines by sheer courage of
igniting the most earth quaking reform agenda in the annuals of Nigeria banking and for
having the nerve to stay its course, more so the current C.B.N Governor Malan Lamido
Sanusi has also proven to be an extra ordinary man; he has acquitted himself exceedingly
well as a prophet to change and a scholar capable of selling even what seems like the most
improvable idea to the diehard skeptic by force by logic and uncommon optimism.

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 The Central Banks of Nigeria under professor Charles Soludo at his inauguration
speech at banker meeting, the New helmsman literally dropped a bombshell that the Nigeria
banking System is ripe for change and the change would not be easy, it would be on a fast
track over the next 18 months that each bank in the country must increase its minimum
capital base to N25 billion before the end of December 2005, the overall policy. Objective was
to strengthen the banks and reposition the financial service industry for better service to the
economy. The recapitalization in the banking sector compelled the Nigeria banks among the
least capitalized bank in the world. A single bank in South Africa, Amalgamated Bank of
South Africa (ABSA) for instance, is larger then all the eighty nine money Deposit. Banks in
Nigeria put together in terms of assets base. Then the biggest Nigerian bank has a capital
base of N240 billion dollars, which comprises dismally with the smallest bank in Malaysia
that has an assets base of 526 billion dollars. The statistics show Nigeria bank is a very poor
light when compared with other operator in the global market place.

Beyond the issue of poor perception the bar news is that the low capital base of banks
has made them less able to finance the economy and more prone to unethical and
unprofessional practice. These include poor credit creation resulting in poor low quality of up
to 21% shareholders fund compared with 1-2% in Europe and America, overtrading and
abandoning the true function of banking to focus on quick profit venture such as trading in
forest and skewing their funding support in favour of import-export trade instead of
manufacturing, reliance or unstable public sector funds for their deposit base, forcing their
female marketing staff into unwholesome conduct to meet unjustifiable targets in deposit
mobilization and high cost of fund.
Infact, low capital base has made distress a recurring decimal in Nigeria Banking
Industry and derived the banks the capacity to finance the commanding, heights of the
offshore markets than the local banks for their funding needs. The re-capitalization has led
the bank force to consolidation of the industry through merges and acquisition.
2.3 CURRENT LITERATURES BASED ON THE VARIABLES OF THE RESEARCH
QUESTIONS.
Mallam Sanusi Lamido Sanusi in 2012 said Nigeria has about 17.6 million MSMEs
employing about 32.4 million people, and contributing about 46.54 percent of nominal G & P
“A recent survey by IFC and Mckinsey (2010) suggests that 80 percent of these MSMEs are
excluded from the financial markets. The state of MSMEs in the country underscores the
importance of this fund.

Suffice it to say that between 2003 and 2012, commercial bank loans to small scale
enterprises dropped at an exponential rate and a further decline in 2012 to 0.14 percent.
“The CBN has tried many interventions for the MSMEs in the past to address their funding
challenge.

IYIEGBUNIWO (2011) says that the measures taken so far by C.B.N to sanitize the
banking system were not fundamental enough to be called a Reform. He said that the major
thing that exercise has achieved is the recognition of bad loans, which has been taken care of
in the past with prudential guideline. He criticized the hasty manner the apex bank handle
the issue of toxic assets in the banking system without putting measure on ground, like
setting up an asset management company to take over the bad assets. This he said threw the
sector into turmoil and forced banks to cut off lending the productive sector. He pointed out
that C.B.N might have been concerned with the problems of insider abuse and poor
corporate governance than the issue of bad loan. He also saw the fixing of the tenure of
banks chief executives for a maximum of 10 years by the apex bank as dictational “for the
CBN to impose on the banks a time limit for it’s chief executive means that it has gone
beyond it regulatory powers practically dictating how a bank should be run.

Muda (2010), told News watch that the directives that banks must full provision of
their non-performing loans was curtailed the credit appetite of banks and create a credit

7
squeeze in the economy, foreign bank require full cash back up for letter of credit issued by
Nigeria bank. He believe that they are thinking that there is something wrong with out
banking system and need to be caution to protect themselves in giving credit to Nigeria
importer.

Abadan (2011) say that it was not the current banking reform perse that has caused
the credit squeeze being talk about, rather it was the past bad behaviour of the banking that
was turning them and it would be self defeating to the banks if they prolonged the credit
crisis and urged them to resume the business of lending, especially to the producer and even
consumer to stimulate demand. He further argues that there is no reason for banks not to
lend except they went to go out of the business of banking.

2.4 SUMMARY OF LITERATURE REVIEW

As a service delivery sector, custodian of the people’s wealth and dealer in the “real
thing” (money), which everybody needs, there are lot of expectation. The dynamic of banking
and indeed, every business endeavour calls for concerted efforts to sustain trust, confidence.
The banking sector Reforms will go a longer way to strengthened banking regulation and
restore public confidence in the banking system people can now trust he credibility and
integrity of banks financial system. The banking terrain in Nigeria is one of the most
sophisticated, yet challenging in term of structure and component, but the current bank
reform will help to prevent mass failure otherwise well capitalized and structured bank will
save depositor and shareholder from shedding tears if the bank had collapsed. The era is
reckless lending is over as banks are guided by sound lending principle and regulations.

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CHAPTER THREE
3.0 RESEARCH METHODOLOGY
This chapter consists of the Design of the study, Area of the study, population of the
study, sample of the study, instrument of data collection, validation of the instrument,
Distributions and retrieval of the instrument and method of data analysis.

3.1 DESIGN OF THE STUDY

The design of the study is based on questionnaire, interviews, personal observation
and internal service it adopted a survey design.

3.2 AREA OF THE STUDY

This research work is carried out in the reforms in the Nigeria banking sector of the
economy with its cost and benefits. The study centered on Money Deposit banks in Nnewi,
Ecobank as a case of study.

3.3 POPULATION OF THE STUDY

The population of the study is Nigeria Money Deposit banks, Ecobank as a case of
study junior staff, senior staff and customers. A total population of 80 was considered
adequate for the study.

3.4 SAMPLING TECHNIQUES

It is not possible to carryout research on the entire management staff of Nigeria
Ecobank Bank. Sample size of 80 is taken by the researcher. The researcher used the
random sampling technique in the selection of the 80 respondents out of the total population
of 100 employees in eh senior and junior management categories of staff.
Formula is yaro yamani’s formula
n x 100 where as
N 1

N = N

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 1 + N(e)2

n = sample size
N = Total population
e = Level of significance (5% or 0.05%)
N = N N = 100
1+n(e)2 1 + 100(0.05)2

N = 100

N = 100
1+100(0.0025)2 1 + 0.25

N = 100
1.25

N = 80

3.5 SOURCES OF DATA COLLECTION

The nature of the study has made if necessary to adopt the case study method which
laid emphasis on situation analysis. The main source of information is the Nigeria Ecobank it
self-through the use of primary and secondary data collection process.

1. Primary Data Information: data was collected through the use of questionnaires,
personal interview and observation were distributed and answered, then information
was gathered.
2. Secondary Data Information: The source of secondary data was mostly from the
library. This includes textbooks, journals, newspapers, magazines, and previous
research work done by eminent scholars.

3.6 INSTRUMENT OF DATA COLLECTION

The instrument used for data collection of this study is questionnaires and focus
group discussion. The questionnaires are carefully formulated questions consisting of open
and closed ended items that are relevant to the theme of the study.
The questionnaire contains 20 items and is divided into two sections. Section A is
aimed at collecting personal biographic data and background of the respondent while section
B centers on the main issue highlighted in the research question and the objective of the
study.
In the questionnaire, guidelines are given to respondents on how to fill the
questionnaires so as to avoid irregularities. Each respondent is expected to tick against the
alternative which best expresses to his/her opinion or attitude.

3.7 VALIDATION OF THE INSTRUMENT

The instrument used was carefully supervised and validated by the researcher’s
supervisor. The items in the questionnaire reflected what the investigation was all about and
what guaranteed the content as being validated.

3.8 DISTRIBUTION AND RETRIEVAL OF THE INSTRUMENT

After distributing 80 questionnaires, some were collected 5 day later while a good
number of the work were collected on the spot. Those collected 5 days later were those
distributed to officers of the banks were occupied with much work that they cannot complete
the questionnaires on the spot. Altogether a total of 80 questionnaires was administered and
80 was retrieved.

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3.9 METHOD OF DATA ANALYSIS
Data collected was analyzed with the use of percentage analysis and presented in table using
the formula.

No of Response x 100
Total no of response 1

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CHAPTER FOUR
4.0 DATA PRESENTATION AND ANALYSIS
This chapter is concerned with the analysis of the data collected and use of the data to
prove the validity or otherwise of the research question.

4.1 PRESENTATION AND INTERPRETATION OF DATA

QUESTION I
How will the Nigeria Banking sectors create employment for the unemployed?
TABLE I
Variable No of Percentage
Respondents
Providing employment
opportunities 80 100%
By not providing employment - -
opportunities
Total 80 100%

All the respondent agrees that reform have relative effect on the level of employment by
providing employment opportunities.

QUESTION II
In what ways will the banking sectors control and consolidate aggressive marketing?
TABLE II
Variable No of Percentage
Respondents
To control, they provide
regulatory authority 64 80%
Lack of regulatory authority
16 20%
Total 80 100%

80% of the respondents are with the fact that to control and consolidate aggressive
marketing, regulatory authority should be made while 20% disagree with the fact.

QUESTION III
How will the problems of high interest rate and high credit to the industrial sector be
reduced?
TABLE III
Variable No of Percentage
Respondents
By saving revenue of the
government rising from the 52 65%
uncertainties of the international
oil.
By not saving revenue of the

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government rising from the 28 35%
uncertainties of the international
oil.
Total 80 100%

From the above table 65% of the respondents strongly believe that the problem of high
interest rate and high credit to the industrial sectors can be reduced by saving revenue of the
govt. rising from the uncertainties of the international oil while 35% disagree with the fact.

QUESTION IV
In what ways will the poor performance of the money deposit banks be restructured?
TABLE IV
Variable No of Percentage
Respondents
By creating strong and reliable
banking industry 64 80%
By not creating strong and reliable
banking industry 16 20%
Total 80 100%

From the above table 80% of the respondents strongly agree that the poor
performance of the money deposit banks can be restructured by creating a strong and
reliable banking industry while 20% disagree with the fact.

QUESTION V
In what way will the economy be pushed towards the economic globalization and liberation in
the banking sector?
TABLE V
Variable No of Percentage
Respondents
By providing efficient and sound
financial system 76 75%
Lack of Efficient and sound 4 25%
financial system 35%
Total 80 100%
From the above table it revealed that reform can push the economy towards economic
globalization and liberation in the banking sectors by providing efficient and sound financial
system, 95% of the responding agree with the fact while 5% of the respondent disagree with
the fact.

QUESTION VI
How will the banking strategies and service in the economy be improved?
TABLE VI
Variable No of Percentage
Respondents
By operating in a safe sound and
conducive environment 68 75%
Lack of Efficient and sound 4 25%
financial system 35%
Total 80 100%
FINDINGS
i. It is found that reform have related effect on the level of employment by creating
employment opportunities.
ii. It is found that banking sectors can control and consolidate aggressive marketing by
providing regulatory authority.

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iii. It is found that poor performance of the money despot bank can be restructured by
saving revenue of the government rising from the uncertainties of the international oil.
iv. It is found that poor performance of the money deposit bank can be restructured by
creating strong and reliable banking industry.
v. It is found that reform can push the economic globalization and liberation in the
banking section by providing efficient and sound financial system.
vi. It is found that banking strategies and services in the economy can be improved by
operating in a safe sound and conducive environment.

4.3 DISCUSSION OF THE FINDINGS

From the answers to the questions administered the respondent the following were
made.
All the respondents agreed that reforms can create employment for the unemployed by
providing employment opportunities while 80% agreed that to control and consolidate
aggressive marketing regulator authority is to be made while 20% disagree with the fact. 65%
of the respondent believe that the problem of high interest rate and high credit can be control
by saving revenue of the government rising from the uncertainties of the international oil
while 35% disagree with the fact. 80% of the respondent strongly agrees that poor
performance of the money deposit bank can be restructured by creating strong and reliable
bank industry while 20% of the respondent disagrees with the fact.
Finally 95% of the respondent believe that reform can push an economy to
globalization and liberation by providing efficient and sound financial system while 5%
disagree with the fact and 85% of the respondent that the banking strategies and services in
the economy can be improve by operating in a safe sound and conducive environment while
15% of the respondent disagree with the fact.

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CHAPTER FIVE
5.0 SUMMARY, OF FINDINGS, CONCLUSION AND RECOMMENDATIONS

5.1 SUMMARY OF FINDINGS

It is evidence from the foregoing assessment of the performance of the Nigeria Banking
that is a fragile and need urgent attention if it will still play the catalyst role in the
development of the Nigeria economy. As its present state, it may not, in effect be in a position
to meet the nation’s ideal of a strong competitive and reliable banking system which
depositors can trust, investors can rely upon and the nation depend upon to facilitate the
economic growth. It therefore requires urgent and fundamental restructuring and refocusing.
The current sector reform represents the fundamental restructuring needed to address the
structural and operational problems of the sectors and reliable to create a strong and reliable
banking sector which will play active developmental roles in the Nigeria economy.

5.2 CONCLUSIONS
The banking system is the engine of growth in any economy, given its function of
financial intermediation and through this function. Banks facilitate capital formation.
Lubricate the production engine turbines and promote economic growth.
The research work attempts to examine the various reforms that have taken place in
the Nigeria banking sector. The reforms were necessitated by the deplorable state of the
banking sector which needed to be addressed. The importance of the banking sector to the
economy cannot be overemphasized.

However, banks ability to engender economic growth and development depends on the
health, soundness and stability of the system. The need for a strong reliable and viable
banking system is underscored by the fact that the industry is one of the few sectors in
which the shareholders fund is only a small proportion of the liabilities of the enterprise. It is
therefore, not surprising that the banking industry is one of the most regulated sector in any

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economy. There were a lot of deficiencies in the Nigeria banking system which needed to be
tacked urgently to avoid a systematic distress in the sector.

5.3 RECOMMENDATIONS
Having gone through the findings, literature review and personal interviews, the
researcher recommend that the review of universal banking model should be adopted and
the categorization of Nigeria bank.

The researcher also recommends signing into law the establishment of an asset
management corporation of Nigeria which is on the front banner of therefore agenda.

It will act as a recapitalization vehicle to sock the toxic asset of the banks.

5.4 LIMITATIONS OF THE STUDY

TIME CONSTRAINT: This research work requires enough time for efficient and effective
collection, computation and analysis of data collection, unfortunately the times interval
available and the researcher pressing needs to attend lectures made it impossible for the
research to be carried comprehensively as it expected of him.

FINANCE: Finance poised a big constraint for a comprehensive research work to be done as
the researcher is a student that depends on his parents as only source of finance and money
used for going to many banks to gather information and data effected the normal living
standard of the researcher. However, there is internet option to travel which requires a lot of
financial commitment.

5.5 SUGGESTIONS FOR FURTHER RESEARCH

Further research should be carried on the role of CBN to adopt a lasting reform with
minimum job losses more research should be carried on effective risk management practice
within the banks.
Research work should also be carried out measuring the relationship between the real
economy and financial sector.

REFERENCES
Charmberlain S.P. (2004), “Nigeria Banking
Reform. A Better Pill Long Overdue”. Internet: (Peterside@gol.com.

IFC and Mckinsey (2010), “Briefs Series NO 2000 –

2007 Post Consolidated Challenges in Nigeria Banking Sector.

Iyiegbunino (2011), Consolidating the Nigeria

Banking Industry to Meet the Development Challenges of the 21 st Century Financial
Standard. “An add Delivered to the special meeting to the bankers committee.

Muda (2010), “Beyond Consolidation Attaining

Value Maximization” Keynote address delivered at FITC 21st Annual Directors
Conference Abuja.

Obadan (2011), “The Nigeria Banking Sector

Reforms and Its Implications on the banking Industry and Monetary Policy. Internet
Source goggle.

Sanusi L.S. (2009), “Development in the Nigeria

Banking System” Address to the Banker Committee.

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Sanusi, L.S. (2010), “Banking Reform has
Strengthened Economy” Speech at Federal Executive Council, Thursday May 20th.

Sanusi L.S. (2012), “The Nigerian Banking

Industry what wrong and way forward” pre-convention lecture of 25th Convocation of
Bayero university Kano

Soludo, C. (2010), “Guideline and Incentives on

Consolidation in the Nigeria Banking System”. Sources goggle.

Soludo, C.C. (2004), “Guideline for Tenure of

Managing Directors of Money Deposit Bank and Retailed Matter. Abuja Sources
Address delivered to the Special Meeting tot eh banker committees.

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