Abstract

An efficient financial system is essential for building a sustained economic growth and an open vibrant
economic System. Countries with well developed financial institutions tend to grow faster; especially the
size of the banking System and the liquidity of the stock markets tend to have strong positive impact on
economic growth. This study Examines the impact of financial sector development and economic growth
on Nigeria. It seeks to know the Impacts of the sector in the Nigerian economy and whether the sector
has been able to achieve its main objective Of intermediation as a result of the inability of the sector to
assist the real sector despite the huge profits declared Yearly & also the short term lending of the banks
instead of long term investment that can boost the economy. financial depth and return on assets will
lead to An increase in economic growth, conversely, an increase in interest rate will result to a fall in
economic growth. recommend that regulators improve both the micro-prudential and the macro-
prudential supervision Of the banking industry, while an upward review of the current minimum capital
base has become imperative Owing to the effect of inflation and fall in the country’s exchange rate.