WILBERFORCE JOURNAL OF THE SOCIAL SCIENCES (WJSS)
ISSN: 2504 – 9232
Volume 2, No. 1, March 2017
Pages 1-17
DOI: 10.36108/wjss/7102.20.0110
BANKING SECTOR REFORMS AND THE PERFORMANCE OF THE BANKING SYSTEM IN NIGERIA
MICHAEL AYIBANUA AMAEGBERI AND EMMANUEL NATHAN
Abstract
This study examined banking sector reforms in Nigeria vis-à-vis the performance of the banking system measured by total credit of banks to domestic private sector (CREP) and banks’ return on assets (ROA). The period of study is between 1971 and 2011. The Ordinary Least Square (OLS) estimation technique was used for the data analysis. The cointegration results confirmed the existence of long run relationship among the variables in the models. The study found that lending rate and spread impacted negatively on CREP. ROA impacted positively and significantly on CREP but minimally on financial deepening. The study recommended among others, a gradual and systematic reduction in the minimum rediscount rate as a means of reducing lending rate to encourage borrowing and stimulate private sector investment in Nigeria.
Keywords: Banking Sector Reforms, Banking System Performance, Financial Deepening