The purpose of this study is to examine the impact of deposit bank lending on private sector growth in Nigeria from 1995 to 2015. This study employs a post hoc survey design to achieve the objectives stated in the study. Data used in the survey were obtained from secondary sources such as the CBN Statistical Bulletin and web browsing. Ordinary least-squares multiple regression was used to test the hypothesis proposed in the study. The results show that deposit bank lending is highly correlated with domestic private investment and manufacturing output as indicators of private sector growth. Also, while bank lending was found to be statistically related to domestic private investment, money supply showed a statistically significant relationship with output. It was concluded that deposit bank lending would have a significant positive effect on Nigeria’s private sector growth. It was therefore recommended that greater efforts should be made to direct short-, medium- and long-term financing not only to private investors, but also to the manufacturing sector, the agricultural sector and SMEs. The transformation process of an economy like Nigeria.

chapter One


1.1 Research background

The modern economic system distinguishes between surplus and deficit economies, thus separating the saving and investment mechanisms. This necessitated the existence of financial institutions whose functions included the transfer or remittance of funds from savers to investors (borrowers) (Levine, 1997). One of these institutions is a deposit bank. Shittu (2012) suggests that the intermediary role of savings banks positions them as custodians of savings for widely distributed surplus economic agents and determinants of the pace and shape of economic development. increase.

Nigeria’s financial system is dominated by the banking sector, especially deposit-taking banks, which hold the largest share of deposits in the economy and also form the basis for the development of the financial system. A depositary bank is a financial institution that provides financial services. B. Acceptance of Deposits, Issuance of Loans, Mortgage Lending and Other Financial Products. B. Savings account, checking account, certificate of deposit, etc. According to mainstream theory, deposit banks act as financial institutions.


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