THE EFFECT OF N25BILLION NAIRA MINIMUM CAPITAL BASE ON THE BANKING SECTOR IN NIGERIA (CASE STUDY OF FIRST BANK OF NIGERIA PLC). A RESEARCH PROJECT MATERIAL ON ACCOUNTING
This research work investigates the effect of N25billion minimum capital base on the banking sector in Nigeria. A case study of the first bank of Nigeria Plc will be carried out to measure the extent to which increased minimum capital base of banks will affect the economy of the nation that is to say whether this move by the central bank of Nigeria will bring a positive effect on the economy.
Therefore the aims of this study are as follows:
i. To examine whether this move will affect unemployment stimulate economic growth and attract investments.
ii. To examine the reason behind the increment in the capital base of banks.
iii. To know what banks stand to gain or loose as a result of this move.
iv. To study the challenges of the new capital base for banks.
As a matter of facts this move must show that it has some benefits, which is promising as to attract investors.
After a comprehensive review of literature data will be collected and questionnaires issued to experts on economic matters and bankers to elicit useful information that will help in actualizing the objectives of this research work.
In the light of the above certain constraint will be faced in this research work which include non disclosure of certain facts due to the secretive nature of banks for security purposes lack of research materials was a constraint in that it is a new move in the banking sector and highly limited time as a result of combining academic work and research work.
Finally what I hope achieve at the end of this research work is to fund out the reasons for the increase in the capital base of banks and how this more will help improve the economy of the nation.
The central bank of Nigeria announced a new capital requirement for Nigeria banks of 25 billion Naira (about US & 181milion) this reflects an increase of from its previous 2billion Naira (Us & 14.5 million) The banks governor has explained that by this he plans to encourage merger and acquisition among the 89 banks currently operating in the country to consolidate and strengthen the nations banking industry. He also hoped that this development would ignite investors confidence on the banks force down interest rate which currently pages at 35% thereby making funds cheaply available to borrowers.