The Contribution Of Commercial Bank To The Economic Growth In Nigeria (1980 –2004)

The Contribution Of Commercial Bank To The Economic Growth In Nigeria (1980 –2004)

Abstract

The Operation of marketable Banks in Nigeria started recently in 19th century and since also their donation to the profitable growth can not be over emphasized. There’s strong acceptance of the proposition that fiscal institutions and particularly the marketable banks contribute significantly to profitable growth. For any country to pursue profitable growth, thus fiscal coffers can not be avoided. These fiscal coffers are gotten substantially from marketable banks. This substance of marketable banks isn’t only to make profit for their business but also to make life meaningful to the society through their loans and advances.

This exploration work examined the donation of marketable

Banks loans and advances. The end is to know their proportions in the development of Nigeria profitable growth.

The result from the exploration showed that loans and advances are

appreciatively related with gross domestic product.

TABLE OF CONTENTS

Title runner i

blessing runner ii

fidelity iii

Acknowledgements iv

Abstract vi

Table of contents vii

CHAPTER ONE

preface

Background of the study 1

Statement of the problem 3

Objects of the study. 5

Thesis of the study 5

Significance of the study 6

compass and limitations of the study 7

Delineations of terms. 7

CHAPTER TWO

LITERATURE REVIEW

Theoretical Literature 11

Empirical literature 35

Limitations of the former studies.. 40

CHAPTER THREE

METHODOLOGY

Theoretical Framework. 41

Model specification.. 44

system of evaluation 45

Data needed and source 46

CHAPTER FOUR

donation AND ANALYSIS OF RESULTS

The empirical results 47

Statistical tests of significance. 48

Evaluation of the working suppositions..50

Counteraccusations of the results

CHAPTER FIVE

SUMMARY, CONCLUSION AND RECOMMENDATIONS

Summary of the findings. 52

Conclusion. 53

Recommendations. 54

References. 56

Chapter One

Preface

Background Of The Study

There are relatively a number of interpretations on the term growth. Be it as it may, the problem of profitable growth was originally seen largely as an profitable problem to be dived largely by economists. The massive poverty that live in underdeveloped world was interpreted as low per capita income.

Growth in the late 1960s and early 1970s brought into focus a situation of worsening poverty conditions for the poor in numerous underdeveloped countries despite a fairly good record of growth in public income.

The anteceding development gave rise to adding questioning of the growth- bias. Arising from these questions, further variables were introduced into the description of profitable growth. profitable growth decreasingly took on the generalizations of enhanced rate of growth of public income or increase in the rate of growth of per capita affair coupled with a fairer and further indifferent distribution of the performing affair. The ultimate condition of course implies perfecting conditions of employment as well as increased provision of social services. Indeed the stress on the conceptualisation of profitable growth came focused primarily on the provision of introductory requirements for the millions of the people.

still, the wider interpretation of the conception profitable growth surfaced in 1978s when profitable growth was defined or refers to as the increase in real affair or real per capital affair of an frugality. This implies that the standard of living of the people in any frugality is stylish measured in terms of real affair per person.

The position of marketable banks to profitable growth of Nigeria and other less advanced countries( LDC) can not be over emphasized. This is manifested by combined sweats of government, policy makers and academic economists likewise; hence in recent times in Nigeria, the marketable banks have shown lesser interest for profitable growth and development.

The government under its intertwined profitable growth and development programme has established small scale; agro grounded diligence and has also developed certain measures aimed at encouraging diligence, commerce, husbandry and other services.

The banking decree of 1969 empowers the central bank of Nigeria to grant blessing for the open and ending of branches by marketable banks; and 1976 fiscal system review commission proposed that marketable banks should grease the transportation of frugality of promoting the rapid-fire expansion of incinerating installations, services and cultivate banking habits. There has been striking modernization of banking habits, rallying of saving for investment in other areas of the frugality.

Statement Of The Problem.

Growth has numerous aspects, which are interrelated. It involves moving society in a favored direction an enhancement in physical structure high position of morality, political development, social development and profitable growth.

In any ultramodern society, profitable growth and political development are the major pretensions, which can not be achieved independently. In short they’ve been the major issues of any developing country in which Nigeria belong, originally, enhancement in the public weal was measured according to the rate of growth in gross domestic product but presently growth is seen as enhancement in the general weal of the society. It’s generally manifested in desirable changes in the colorful aspect of the life of the society.

Other aspects of profitable growth includes reduction in position of affectation, increase in per capital income, increase in employment, indifferent distribution of income, favourable balance of trade and payment etc. As an important institution, marketable banks have been contributing to the profitable growth of this country. This they do through the process of capitalization of fiscal coffers, effective allocation of these available coffers and furnishing institutional mechanisms through which coffers is mustered and directed from the fat spending units to the deficiency spending units.

profitable growth in this exploration means increase in volume of goods and service. These goods services are used to measure the standard of living, which is as a result of increase in gross domestic product over the times. These goods and services aren’t produced by themselves rather by enterprises or companies that use coffers( both mortal and natural coffers) before any goods services are produced. exemplifications of these enterprises or companies include uni-lever, Nestle food, Nigeria Breweries etc. These companies or enterprises, which produce these good and services that ameliorate or increase our standard of living depend on the position of capital they admit from this sector( marketable banks), that’s the donation of marketable banks to profitable growth of Nigeria.

Ideal Of The Study

In contemporary Nigeria society as in all developing societies, which are incorporate into the global commercial frugality, the most burning need is profitable growth and development. And to achieve these objects there’s need for fiscal institutions particularly marketable banks.

The purpose of this study is primarily to probe the donation of marketable banks to Nigeria profitable growth using their loans and advances.

Thesis Of The Study

In, the course of this exploration, the following thesis are going to be put forward and scientifically tested.

HO b1 = O There isn’t significant relationship between marketable

banks ’ loans and advances and Gross Domestic product in Nigeria

H1 b1 = O There’s a significant relationship between marketable

banks ’ loans and advances and Gross Domestic product in Nigeria.

Significance Of The Study

benefactions of marketable banks towards profitable growth especially in developing nations are veritably essential. This study helps in better understanding of the positive impact of marketable banks especially inn Nigeria. It treats how marketable banks in Nigeria have made its donation to the attainment of profitable growth.

This analysis will help the policy makers to find a better way of regulating the conditioning of marketable banks in particular and fiscal institutions as a whole. This study hopes to stimulate, farther disquisition on how the donation of marketable banks to profitable growth could be increased.

Compass And Limitations Of The Study

The study is directed to cover marketable banks ’ loans and advances from also period 1980 – 2004. The study reflects to a large extent what’s accessible in our marketable banks and data collected and used are substantially secondary data.

Due to deficient data for the time 2005, the exploration work covered the period of 1980 – 2004, but trouble where made to insure that the study was carried out to meet the current demand and comprehensiveness as adequately as possible.

Delineations Of Terms

profitable Growth It means the chance periodic change in the public income of a country or a group of countries. It can be defined as increase in real gross public product over a time or if country’s gross public product has come larger than before profitable growth is desirable since a growing frugality means that there will be more goods and services for the people to consume. The rate of the gross public product must be advanced than the rate of growth of the population before we can say that growth has had a positive impact on the weal of the citizens( kuznet 1973). profitable growth is an anchor in which other aspects of profitable development depend on.

Economic Development To mokes the changes in public weal we use the conception of development rather than growth. profitable development is a process of enhancement in the general weal of the society. It’s generally manifested in desirable changes in the colorful aspects of the life of the society.

profitable development includes the following-

a) A reduction in the position of severance.

b) A reduction in the extent of particular and indigenous inequalities.

c) A reduction in the position of absolute poverty.

d) A rise in the real affair of goods and services.

e) Advancements in the position of social and political knowledge of people.