Department of Banking and Finance

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    Open Access
    Achieving Maximum Economic Transformation Impact In Fragile States Through Aids And Debt Relief
    (2007) Obademi, O.E.
    This paper focuses on the peculiar features of fragile states and I have tried to put forward some approaches that can be adopted by development finance organisations and friendly countries at bailing out these states-from their predicament. With the growing awareness and acceptance of the notion that poverty anywhere is a threat to prosperity everywhere and prosperity anywhere should be shared everywhere it is , obvious that fragile states can not be left on their own without external assistance. A link between fragile states and the global economy was done with particular recourse to . debt relief. aids and fragility while drawing conclusions and making recommendation on the mix of approach to be adopted in giving aids and debt relief that will help achieve maximum economic transformation impact in fragile stales.
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    Open Access
    An analysis of the impact of external debt on banks' performance:
    (BritishJournal Publishing Incorporated, 2013) Obademi, O.E
    This study focuses on the long run relationship and causal impact between foreign or external debt and bank performance using different performance indices such as return on capital employed, earnings per share and return on equity. The micro analysis done which in this regard is on the firm specific choice of the two big banks in Nigeria i.e. First Bank Plc and United Bank for Africa during the period before the debt relief granted to Nigeria is apt against the backdrop of concentration profitability relationship. A general model of the micro analysis was developed with ample support of a macro model underpinned by a simultaneous equation using a vector auto-regression estimation. The findings are that foreign or external debt impacts negatively on bank performance but the direction of impact is different for the two banks chosen in this study. While foreign debt was most felt on return on capital employed by United Bank for Africa, the impact of foreign debt affected the earnings per share most in First Bank Plc. The difference in the direction of causal impact can be attributed to the peculiarity of the internal environment of each of the banks.
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    Open Access
    An Analysis of the Impact of Mergers and Acquisitions on Commercial Banks Performance in Nigeria.
    (2012) Adebayo, O.; Olalekan, O.
    Mergers and acquisitions (M&A) in the corporate world are achieving increasing importance and attention especially with the advent of intense globalization. This is evident from the magnitude and growth of deal values and resultant ‘mega-mergers’ transacted in recent times. This research work attempts to assess the implication of merger and acquisition of commercial banks in Nigeria on their profitability and other associated measures of performance. The research analysis used published audited accounts of ten (10) out of twenty-four (24) banks that emerged from the consolidation exercise and data from the Central Banks of Nigeria which consists of both primary data. The relevant data collected were analyzed and tested using simple percentage and tables. Subsequently, the three hypotheses formulated in this study were tested using correlation co-efficient (r2) and T-Test. The result of the analysis revealed that there is significant relationship between pre and post merger/acquisition capital base of commercial banks and level of profitability, there is significant difference between pre and post-merger acquisition earnings per shares. Merger/acquisition have also increased the capitalization of commercial banks with evidences of changes in company’s share ownership, increase in the cost of services and changes in bank lending rates. Based on these findings, it can be concluded that the merger and acquisition programme has improved the overall performances of banks significantly and also has contributed immensely to the growth of the real sector for sustainable development.
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    Open Access
    Banking Crisis, Reforms and Availability of Credit to Japanese Small and Medium Enterprises.
    (University of California, Press, U.S.A., 1999-08) Owualah, S.I.
    The paper examines the impact of the collapse of Japan's "bubble" economy in the early 1990s and the reforms on the availability of credit to Japan's SMEs especially in the Kansai region - Osaka, Kyoto and Kobe. The extent of the credit constraints faced by SMEs was discerned from the perceptions of their owners and managers via a structured questionnaire. The study found the problem of credit availability to affect SMEs' business performance in different industrial sectors in varying degrees with the most worse off being those in manufacturing. Thus availability, not the cost of credit became a primary concern for SMEs generally. The paper advises the thrust of policy actions should be in ensuring that the conflicts from the reforms do not further undermine access to funding by SMEs.
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    Open Access
    Banks and Consultants in Nigeria's Job Creation Program.
    (1999 Kluwer Academic Publisher,Netherlands., 1999) Owualah, S.I.
    Employment creation has become a central objective of policy in many countries. There is also growing unanimity that it can be better attained via a partnership of the private and public sectors. In order to provide the necessary background, the paper highlights extant evidence on the role of entrepreneurship in employment creation and some of the factors which may constrain it. The paper also evaluates the performance of private banks and management consultants in providing credit and management assistance in the job creation program for unemployed graduates in Nigeria. The evaluation is on the basis of the participants' ratings on some selected performance criteria. On the average, with only one exception, banks obtained better ratings than consultants on six performance criteria that are common to them but failed to meet the participants' expectations on four credit-related criteria
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    Open Access
    Budget Process And Procedures In Porous Developing Economies:Nigeria In Focus.
    (2009-06) Obademi, O.E; Sokefun, A. O.
    This paper focuses on the characteristic features of a typical porous developing like Nigeria in respect of inadequate institutional and legal/frameworks that can sufficiently support the preparation and implementation of a good budget .The experience in Nigeria is that budget implementation and performance often fall short of 50 percent delivery. This has made room for both official and un-official corruption .The paper looks at the economic growth pattern in Nigeria, the budget deficits over some years and the implications for poverty reduction and societal well-being. The popular Medium Term Expenditure Framework (MTEF),budgeting with special attention to activity based costing has been proposed and is being experimented. However in the light of inflation and the volatility cum instability of the sources of revenue for a country like Nigeria. the capacity of an MTEF budgeting approach to deliver the optimum expectation in terms of budget implementation and delivery may he undermined. The recommendation is that instead of the traditional minimum of a 3 year MTEF, a 2 year budget plan may perform better.
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    Open Access
    Competition for Bank Deposits In Nigeria.
    (Giordano Dell-Amore Foundation., 1984) Owualah, S.I.
    This paper is a follow-up on an earlier study by Professor o. Teriba in 1968 on the competition for bank deposits in Nigeria. Consequently it examines the changes in the competition for bank deposits following the enactment of a comprehensive Banking Act in 1969 which among others gave rise to the introduction of monetary policy circulars by the Central Bank of Nigeria. Other factors thought to impact competition for deposits include the growth in number and type of deposit-taking institutions, the entry of development finance institutions and the removal of the dichotomy between expatriate and indigenous commercial banks. The findings showed a steady growth in bank deposits in the face of such impediments to deposit mobilization like extreme rigidity in interest rates and banks' unfriendly attitude to small savers. The paper concludes that the observed growth is not necessarily the result of concerted efforts of banks to compete for deposits but rather the increasing sophistication in the banking habits of most Nigerians.
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    Open Access
    Deregulation and Privatisation of the Upstream and Downstream Oil and Gas Industry in Nigeria: Curse or Blessing?
    (Sciedu Press, 2012) Abu, I.N; Chidi, O.C
    The purpose of this study is to examine the perception of Nigerians on the deregulation and privatisation moves of the government in the oil and gas industry in Nigeria. The oil and gas industry is strategic to national development and growth in Nigeria. Oil and gas constitute about 90% of Nigeria’s foreign exchange earnings and 83% of its GDP. This study adopted the survey research design. It was found that the deregulation and privatisation of the oil and gas industry will usher in sustainable national development and will be a blessing rather than a curse for the citizenry. 77.8% of the respondents believe that the deregulation and privatisation of the oil and gas industry will be a blessing to Nigerians and 80.6% of the respondents do not believe that the deregulation and privatisation of the oil and gas industry will be a curse to Nigerians. The authors recommend that strategic sectors such as oil and gas as well as the power sector should be deregulated and privatised for sustainable national development.
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    Open Access
    An Empirical Analysis of the Impact of Public Debt on Economic Growth:
    (2012) Obademi, O.E
    This paper focuses on the impact of public debt on economic growth using Nigeria as a case study. An analysis of the long-run relationship and impact of debt from the perspective of the value impact and proportional impact was done. The value impact variables used herein include the external debt value, domestic debt value, total debt value and budget deficit figures. The proportional impact variables are ratios of the value impact to the gross domestic product (GDP). An augmented Cobb Douglas model was used and subsequently a dynamic version of the functional relationship was estimated using Co- integration technique to capture the long-run impact of debt variables on economic growth. The result showed that the joint impact of debt on economic growth is negative and quite significant in the long-run though in the short-run the impact of borrowed funds and coefficient of budget deficit is positive. In the study, the speed at which the short-run equation converges to equilibrium in the long-run as shown by the Error Correction Mechanism coefficient was found to be slow. The conclusion from this study is that though in the short-run the impact of borrowed fund on the Nigerian economy was positive, the impact of debt in the long-run depressed economic growth as a result of incompetent debt management. Key words: Public debt; Economic growth
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    Open Access
    Exchange Rate Volatility And Economic Growth In Nigeria
    (2012-06) Ezike, J.E.; Ajayi, L.B.
    Consequent upon the simultaneous collapse of the Bretton wood system and the adoption of the flexible exchange rate system in many countries, economist and policy maker are concerned about the effect of exchange rate volatility on the economy in general. However, theoretical, and empirical work on the subject has produced mixed results. This study investigate the likely impact of exchange rate volatility on Nigeria economy using Generalized Method of Moment analysis and GARCH and ARCH modeling with annual time series covering the period between 1980 to 2009. Interesting result was found, exchange rate was found to have a negative and significant effect on Nigeria economy. It was also discovered that exchange rate generated via GARCH was volatile during the period studied. Based on this, it is instructive, therefore, that a coordinated monetary and fiscal policy should be put. in place 10checkmate the fluctuation of exchange rate so as to bring rapid development to Nigeria economy.
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    Open Access
    Factors Influencing Entrepreneurial Career Aspirations of Students in Nigerian Tertiary Institutions.
    (2010) Owualah, S.I.; Mojekwu, J.N.
    The paper attempts to investigate the issues about which students in tertiary institutions in Nigeria are most concerned as influencing their entrepreneurial career aspirations and how their institutions have influenced them. Also it aims at determining whether students in engineering and science disciplines perceive themselves to be having the same concerns about entrepreneurship as their business management counterparts. Two structured questionnaires were administered; one for students in business, engineering and science faculties/schools and another for their deans and heads in six selected tertiary institutions. The most critical factors likely to influence entrepreneurial career among students as well as the teaching of entrepreneurship were identified and rank ordered in terms of importance.Spearman's rho was later applied to ascertain overall agreement on faculty/school basis. Mean scores were estimated determine the extent of each set of respondents' agreement or disagreement with the influence of courses offered on entrepreneurship career aspirations. Academic curriculum, intrinsic rewards, skill/training, government/institutional support, role model influence, funding, job availability, risk of unemployment and possession of business ideas were important factors analysed as likely to influence students' entrepreneurial career aspirations after graduation. The results of this study are important for policy making in order to increase interest in entrepreneurship among prospective graduates of Nigerian tertiary institutions and to ensure the longterm and sustained supply of entrepreneurs. Tertiary institutions have an important role to play in preparing their graduates to be prospective entrepreneurs instead of job seekers.
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    Open Access
    Foreign Direct Investments and Economic Growth of African Regions: A Comparative Study
    (University of Lagos Press and Bookshop Limited, 2016) Igbinosa, S.O; Abu, I.N
    The paper examines the impact of Foreign Direct Investments (FDIs)on economic growth in the five regions of Africa, as well as identifies their respective drivers of growth. It employs the Ordinary Least Squares (OLS) multiple regression analysis to examine the relative impact of Foreign Direct Investments, balance of payments, trade openness, technology and quality of labour force on economic growth in each of the five regions between 1980 and 2012. The study finds thatforeign Direct Investments (FDIs) have no significant impact on economic growth in thefive regions of Africa. The impact of FDI on growth is positive in Eastern, Middle and Western Africa but negative in Northern and Southern Africa. Similarly, there are differentials in the drivers of growth in thefive regions. While trade openness is a negative driver of growth in all regions of Africa except in Northern Africa, both balance of payments and quality of labour force have mixed impacts on economic growth in Africa. In addition, technological progress impacted growth in Middle, Southern Africa and Western Africa but it appears that lack of it retarded growth in Eastern and Northern Africa. The study calls for policy reform frameworks that encourage and boost foreign Direct Investment flows to all regions of Africa, particularly Direct Investments in critical sectors of the economies, as well as check the negative effects of foreign Direct Investments. Furthermore, it recommends that regional economic blocks in Africa should be resuscitated and supported to develop and promote intra-Africa trade and Investments.
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    Open Access
    Globalisation and Small and Medium Enterprises in Nigeria"
    (2012) Owualah, S.I.; Fakiyesi, O.; Adebiyi, M.A.
    The paper examines the nature, characteristics and problems of SMEs in Nigeria. It adopts the SWOT analysis to highlight the opportunities and threats facing them as a result of globalization bearing in mind their strengths and weaknesses. It further proffers suggestions on ways of ameliorating the threats of globalization. These include adoption of information and communication technology, embracing new management and organizational system, formation of strategic alliances and other forms of cooperation, building industrial support institutions and infrastructures and formulation of business-friendly policies.
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    Open Access
    How Domestic Debt Hurts Bank Performance:
    (2012-12) Obademi, O.E
    This study focuses on the interplay of domestic debt and bank performance and thus an attempt has been made to investigate the long-run relationship and direction of causality of the impact of domestic debt on bank performance using different variables herein the earnings per share, return on equity and return on capital employed. The banks used are the First Bank of Nigeria Plc, United Bank for Africa Plc being the two banks with huge penetration in the Nigerian banking industry. A general model for the micro analysis was developed with ample support of a macro model with the background of a simultaneous equation and further use of vector auto-regression estimation procedure. The result of the analysis shows that domestic debt impairs bank performance but the direction of impact on the two banks varies. While domestic debt impacts most negatively on the return on equity of First Bank Plc followed by its earnings per share, for United Bank for Africa domestic debt impacts most negatively on return on capital employed followed by its return on equity. It is believed that though domestic debt can be used as an instrument of economic stabilization, nonetheless, care must be taken to avoid a situation whereby it makes the business environment unfriendly.
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    Open Access
    The Impact of Nigeria's External Debt on Economic Development.
    (Emerald Group Publishing Limited, 2008) Adegbite, E. O; Ayadi, F.S; Ayadi, O. F.
    Purpose – This paper aims to investigate the impact of huge external debt with its servicing requirements on economic growth of the Nigerian economy so as to make meaningful inference on the impact of the debt relief which was granted to the country in 2006. Design/methodology/approach – The neoclassical growth model which incorporates external sector, debt indicators and some macroeconomic variables was employed in this study. The paper investigates the linear and nonlinear effect of debt on growth and investment utilizing the ordinary least squares and the generalized least squares. Findings – Among other things, the negative impact of debt (and its servicing requirements) on growth is confirmed in Nigeria. In addition, external debt contributes positively to growth up to a point after which its contributions become negative reflecting the presence of nonlinearity in effects. Originality/value – Nigeria's external debt is analyzed in a new context utilizing a different but innovative model and econometric techniques. It is of tremendous value to researchers on related topic and an effective policy guide to policymakers in Nigeria and other countries with similar characteristics.
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    Open Access
    Impact of Workers' Remittances on Financial Development in Nigeria.
    (Canadian Center of Science and Education., 2011-10) Oke, B.O
    In this study we examine the nexus between remittances and financial development (FINDEV) in Nigeria from 1977 to 2009. Towards achieving the objective of this study, we employ both the ordinary least square estimation (OLSE) technique and the Generalized Method of Moments (GMM) estimator. Moreover, key diagnostic tests are carried out in order to ascertain model adequacy. We also use two indicators of FINDEV, namely: the ratio of money supply to GDP (m2/gdp) and the ratio of private credit to GDP (cps/gdp). The results generally indicate that remittances positively and significantly influence financial development in Nigeria, with the exception of the cps/gdp measure of FINDEV in the GMM estimation where the coefficient is insignificant. This implies that remittances augment liquid liabilities more than loanable funds in Nigeria, as remittances are likely used more for consumption purposes than for productive ventures in the country. Since remittances provide foreign exchange that is vital to both the internal and the external sectors of the economy, they should be encouraged via appropriate policy formulation and implementation. Financial intermediaries and institutions operating in Nigerian should also intensify the mobilization of remittances with the aim of making them important sources of loanable funds in the country.
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    Open Access
    The Influence of Deregulation and Privatisation of the Upstream and Downstream Oil and Gas Industry Promote National Sustainable Development in Nigeria
    (2016) Abu, I.N
    The purpose of this study is to examine the perception of Nigerians on the influence of deregulation and privatisation moves of the government in the oil and gas industry in Nigeria. The oil and gas industry is strategic to national development and growth in Nigeria. Oil and gas constitute about 90% of Nigeria’s foreign exchange earnings and 83% of its GDP. This study adopted the survey research design. It was found that the deregulation and privatisation of the oil and gas industry will usher in sustainable national development and will be a blessing rather than a curse for the citizenry. 77.8% of the respondents believe that the deregulation and privatisation of the oil and gas industry will be a blessing to Nigerians and 80.6% of the respondents do not believe that the deregulation and privatisation of the oil and gas industry will be a curse to Nigerians. The authors recommend that strategic sectors such as oil and gas as well as the power sector should be deregulated and privatised for sustainable national development.
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    Open Access
    A Macro Analysis of Bank Performance in Debt-Burdened Countries: The Case of Nigeria
    (2013) Obademi, O.E
    'in this study the focus is on the long-run relationship and impact of public debt on banking industry performance i.e. a macro-analysis in Nigeria using different performance indices such as total bank lending, total bank deposit and total bank branches between the period I975-2005. A general macro model underpinned by a simultaneous equation using a vector auto-regression estimation approach was done: with the objective of sensitising countries on the need for caution on public debt. The findings arc that public debt impacts negatively on bank performance but the extent of Impact IS different on die variables chosen in this study. The analysis carried out show that domestic debt Impacts most negatively on total bank lending while external debt:impacts most negatively on total bank deposit. It IS believed that though domestic debt can be used as an instrument of economic stabilization. nonetheless. in the choice of whether to U!)C demesne debt or external debt it may be: more expedient to use external debt based on the outcome of this study though it should be slated that in doing that still, adequate care must be taken to maintain an acceptable Debt GDP ratio needed for debt sustainability.
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    Open Access
    Managing Nigeria's Foreign Reserve for Enhanced Macroeconomic Performance.
    (2007) Obademi, O.E
    This paper focuses on foreign reserve management and its impacts on the macroeconomic performance of the Nigerian economy and by extension the well being of Nigerians. The role of the Central Bank of Nigeria as the principal player or state organ in the use of monetary policy to achieve government's intentions of enhanced human welfare was looked into. Consequently macroeconomic variables like the inflation rate, intermediation spread, foreign exchange rate among others were discussed with the suggestion that it is expedient for the government to use part of the foreign reserve to fund fiscal deficits and undertake strict inflation targeting or flexible inflation targeting by relying on the use of foreign reserve to control exchange rate.
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    Open Access
    Microfinance Institutions in Nigeria: Challenges and Ways Forward
    (Exclusive Journal Publishing House, 2014) Abu, I.N; Aguda, N.A
    The microfinance sub-sector in Nigeria is faced with many challenges. Due to the large number of MFBs, it has been a challenge for regulators to provide strict and close supervision of their activities. However all hands must be on deck to ensure that the institutions arc cfficicmly run by surmounting the challenges and exploit the prospects, because microfinancc provides a credible platform for the eradication of the poverty and economic development of the nation.