BANK CAPITAL ADEQUACY AND ECONOMY DEVELOPMENT

BANK CAPITAL ADEQUACY AND ECONOMY DEVELOPMENT

Abstract

The study examines bank capital adequacy and economy development in Nigeria. The objective of the study is to find out the reason for the review of capital base of commercial banks in Nigeria and to find out the determinants of bank’s capital adequacy. In this study, personal interview, questionnaire, internet and textbook were employed in the collection of data. Data collected were presented in tables and percentages form. Percentage methods were used to analyze data collected while the chi-square statistical model was used to test for the hypothesis formulated. The study revealed that new capitalization rate will increase the output capacity in Nigeria. Based on the findings, the study recommended that the Federal Government should give a strong competition to the commercial banks on the issue of moving the nation forward. This they can do by way of giving out loans to people at a very reasonable rate of interest through any of the designated development bank.

CHAPTER ONE

INTRODUCTION

1.1     Background to the Study

The downturn in the nation’s economy ever since termination of the Republic in 1984 and coming of the military thereafter is no longer news. Series of efforts by the various government whether sincere of insincere towards improving the betterment of the economy are also appreciated. Of importance to any economy is the financial market which comprises of both Capital Market and Money Market of lich commercial bank is an integral part. Ever since the establishment of the first commercial bank more than a century ago, the industry has witnessed a lot of topsy-turvy depending on government policies and regulations. Years before introduction of structural adjustment program (SAP) in 1986, there were few banks working in a regulated environmentand with the coming of SAP the whole economy became porous courtesy of the regulation syndrome occasioned by preaching and teaching of SAP. What became the order of the day were the proliferation of banks and other financial institution. The banking sector was so bastardized that every nook and corner there sprang up banks. What is witnessed today is that these banks are in form of distress, which is now history.

1.2Statement of  Problem

The importance of bank capital adequacy in a country cannot be over emphasized. Commercial banks are supposed to be one of the agents by which the nation’s economy could be rejuvenated (make more lively or useful). But from the angle of the new Governor of the Central Bank of Nigeria, the banks rather than being an agent of boom to the nation have been agent of doom. They refuse to pay the economy, but rather inflict pain on the economy. They are supposed to play in the achievement of macroeconomic objective of maintaining price stability and reduction of unemployment in the economy.

DOWNLOAD COMPLETE PROJECT MATERIAL

BANK CAPITAL ADEQUACY AND ECONOMY DEVELOPMENT