The Impact of Banks Credit in the Nigeria Economy (A Case Study of First Bank of Nigeria Plc and Zenith Bank Plc, Ekwulobia)
Chapter One
OBJECTIVES OF THE STUDY
The purpose of this study includes:
- To determine the extent to which the various bank credits have been felt in the Nigeria economy.
- To access the level of the knowledge of the various credit facilities provided by the banks in the Nigeria economy.
- To determine the response of the various business existing in the various sector of the economy to banks credit facilities.
- To review the impacts of the central bank of Nigeria (CBN) monetary policy in the banks.
CHATER TWO
LITERATURE REVIEW
BRIEF INTRODUTION
This chapter of the research work deals with the review of relevant literatures as it pertains to this study. Different materials such as text books, journals and other seminar work were consulted and issues related to the research topic were extracted
MOELS TO THE RESEARCH QUESTIONS
Commercial banks credit plays crucial roles in the development of any economy. Nzotta, S.M., (2009) contend that bank credit influence positively to the level of economic activities in any country. It influences what is to be produced, who to produce it, and how much is to be produced. CBN seminar paper (2002) postulates that credit is the money that banks give out, loans and advances with future date of repayment. An important role of bank is to provide ways of providing loans to the various sectors of the economy. The CBN prudential Guidelines of 1990 however provides a wider definition of credit, and this includes aggregate of all loans, advanced overdraft, bills discounted, banks guarantee, banks acceptance, commercial papers, leases and indemnities. Essang and Olajide (1994) identified banks as a monetary institution owned by either government or private business for the purpose of profit making. In pursuit of this profit, the commercial banks performs a number of function, one of these functions includes acceptance of deposits from the public .The deposit are in turn given out as a credit to small medium scale enterprises and among others, which led to more production and provision of employment opportunities in the economy.
BANKS IN NIGERIA
The Nigeria economy constitutes various sectors such as financial, agriculture, industrial sectors etc. Under financial sector, there are various firms that make up the industry e.g. Money deposit banks development banks, and Central Bank of Nigeria (CBN). These firms make up the Nigeria banking industry. However, this sector in Nigeria economy needs credit (money) to enable it survive, expand and grow.
Therefore, the banking industry provides credit facilities to the sectors in the economy through various types of credit instruments. The impact of credit to banks and industries in an economy cannot be over emphasized because if there were no banks, the activities of providing credits to the firms and industries in order to encourage economic growth would not have been possible in the economy.
CHAPTER THREE
RESEARCH METHODOLOGY
The standard of a good research work is determines by its methodology. The findings of such methodology must be reliable as well valid. In this chapter, the following issues are described namely: the research design, area of the study, population of the study, instrument for data analysis.
THE RESEARCH DESIGIN
This means the specifications of procedures for collecting and analyzing data necessary for the identification and solution of the research problems. The researcher employed a survey research design data collected from the respondents are therefore analyzed and interpreted.
AREA OF THE STUDY
This research work is geographically based in Anambra state as regards to the selected banks branches in Ekwulobia, Orumba North Local Government Area of Anambra State, Nigeria. It will be too hard to study all the banks in Ewulobia so therefore the research covers only first bank Plc and Zenith bank Plc in Ekululobia.
POPULATION OF THE STUDY
The population of the study consist of some bank staffs and customs of selected banks the population of both one hundred (100) of which (60) are customers and (40) are staffs this can also be shown in the table below :
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS
BRIEF INTRODUCTION
This chapter intends to present, analyze and interpret the result obtained from questionnaire. For the purpose of this analysis, statistical method of presentation will be used as mentioned (in chapter three) of this researched work. A total of forty questionnaires were attended to and all were collected and analysis based on sample size.
CHAPTER FIVE
SUMMARY OF FINDING, CONCLUSION AND RECOMMENDATION
SUMMARY OF FINDINGS
From this research, there is no doubt that the Nigeria economy has felt great on the impact of bank credit. The various facilities granted by banks helped in stimulating economic growth and development. According to Asuzu (2008), bank credit has great impacts in many ways for instance, it facilitate economic activities by providing for the needy sectors. It also has monetary stability of the economy. The central bank of Nigeria for instance, realized the impact of banks credit on domestic growth and development in the country and gives guideline to banks in the country on credit to their customers in its annual monetary circular.
The analysis of the bank credit in Nigeria economy can be said to have great impact to the economic growth and development in the country. All the research questions tested were answered positive in summary, the various credit facilities provided by banks are so important to the country to the extent that if there is no bank, the activities of the economic growth and development would not be possible.
CONCLUSION
On the basis of the findings of the research project work, it is therefore concluded that bank credits have been greatly felt in the Nigeria economy
RECOMMENDATIONS
As regards to the findings in the research work in addition to the conclusion drawn from the findings, the following are recommended:
The various businesses that exist in the various sectors of the Nigeria economy should appreciate the existence of bank and take advantage of the various credit facilities provided by these banks.
Long term credit facilities should be encouraged to aid capital formation of business since it is the main instrument for economic growth and development
People should be educated on the need for bank in the economy and the various credit facilities provided by banks in the country should be made known to the general public.
The monetary authorities should also consider the activities of banks when using the monetary policies.
On the other hand, banks should always comply with the monetary policy of the central bank in order to achieve growths and development in the economy
LIMITATION OF THE STUDY
To get the relevant data needed for this research work, it was no quite simple. The fact is that not many money deposit banks are found in the area of the study. The project was also limited to few hindrances such as lack of sufficient time due to the fact that when the research was carried out, it collides with lecture hours coupled with financial constraints on the part of the researcher.
Another major problem was nonchalant attitude by some respondents who are either not too serious with the question or deliberately not willing to disclose information as the researcher wanted.
SUGGESTION FOR FURTHER STUDY
Due to the limitations mentioned above by the researcher, it is suggested that more effective research should be made while eliminating some of above limitations at a considerable level.
Subsequent researcher should also understudy related topics like :
- Bank credit and economic development of Nigeria
- Commercial bank credit indicator and rural economic growth in Nigeria
- Credit management and bank lending in Nigeria.
REFERNCES
- Agudu P. (pg 18, 1998) “financial Institution in Nigeria” 1st Edition, Onitsha Adson Publishers.
- Anyanwuochar A. (pg 12, 2003) “Fundamental of Economics. 1st Edition Onitsha, Press book Ltd.
- Asuzu C. (pg 37, 2003) “Corporate lending and Bank Service”, For Tertiary Institutions. Press book Ltd Onitsha .
- Okoye A. (pag 11, 2010) “Fundamental of Micro economics for Tertiary Institution” Adson Publishers, Onitsha
- Ezeanata W. (pg 15, 2005) “Money and Banking for Economic Development” 3rd Edition, five publishers Nkpor.
- Jhigan (pg 6, 2008) “Role of Monetary Policy”, alomolaranPublishind Company Ltd. Ibadan
- Johnson (pg 23, 2006) “Development Banking in the Economy”
