ABSTRACT
The study
investigated the effect of deregulation of financial system on the performance
of ■ commercial banks in
Nigeria between 1980 and 2014, The performance of commercial banks in Nigeria
was measured in this study using both banks total assets and banks’ profit
before tax parameters. Time series data obtained from CBN Statistical Bulletin
(various issues) and annual financial reports of various banks in Nigeria
(various issues) covering the period 1980-2014 was used in the study. Data were
analyzed using descriptive statistics and the Ordinary Least Squares (OLS)
regression technique. The data was first examined for unit roots using the
Augmented Dickey Fuller (ADF) with a view to ascertaining their stationarity.
Result revealed that all the unlogged variables used for the study were
integrated of order one, 1(1) except for liquidity ratio(LR) and money supply
growth rate (MSGR) which were used at level, 1(0). Similarly, all the logged
variables used for the study were integrated of order one, 1(1) except for
inflation rate, liquidity ratio (LR), money supply growth rate (MSGR) and
Bank’s profit before tax (PBT) which were used at level, 1(0). Empirical
findings further revealed that bank’s deposit rate (BDR), financial deepening
(FND), maximum lending rate (MLR), real exchange rate (RER), and the dummy
variable deregulation significantly influenced commercial bank’s total assets
within the reference period. Also, inflation rate, liquidity ratio, money
supply growth rate, real exchange rate and the dummy variable deregulation
significantly influenced bank’s profit before tax in Nigeria within the study
period. The result ofthe study revealed that the adoption of financial system
deregulation policy in Nigeria has led to increase in the performance of
commercial banks in Nigeria through increase in banks total assets and profit
before tax. Empirical findings further revealed that, while exchange rate had a
significant negative effect on banks total assets and banks profit before tax,
inflation rate, liquidity rate, monetary policy rate, and money supply growth
rate failed to make any contribution to the performance of commercial banks in
Nigeria in terms ofits total assets. The same was observed using banks profit
before ■ tax model where banks
deposit rate, financial deepening, maximum lending rate, and monetary policy
rate failed to make a significant contribution to the profit before tax of • '
commercial banks in Nigeria within the period under study. The study recommends
that there is need to pursue policies that would ensure that Bank’s deposit
rate (BDR), financial deepening (FND) and maximum lending rate (MLR) are used
in such manner that they would continue to positively influence commercial
banks total assets. There is need to pursue policies that- would ensure that
inflation rate, liquidity ratio, money supply growth rate are ■ monitored to ensure that they
continue to favour bank’s profit before tax.
ANYANIME, I (2023). Impact Of Financial System Deregulation On The Performance Of Commercial Banks In Nigeria:- Essien, Anyanime I.. Mouau.afribary.org: Retrieved Sep 08, 2024, from https://repository.mouau.edu.ng/work/view/impact-of-financial-system-deregulation-on-the-performance-of-commercial-banks-in-nigeria-essien-anyanime-i-7-2
IBANGA, ANYANIME. "Impact Of Financial System Deregulation On The Performance Of Commercial Banks In Nigeria:- Essien, Anyanime I." Mouau.afribary.org. Mouau.afribary.org, 19 Dec. 2023, https://repository.mouau.edu.ng/work/view/impact-of-financial-system-deregulation-on-the-performance-of-commercial-banks-in-nigeria-essien-anyanime-i-7-2. Accessed 08 Sep. 2024.
IBANGA, ANYANIME. "Impact Of Financial System Deregulation On The Performance Of Commercial Banks In Nigeria:- Essien, Anyanime I.". Mouau.afribary.org, Mouau.afribary.org, 19 Dec. 2023. Web. 08 Sep. 2024. < https://repository.mouau.edu.ng/work/view/impact-of-financial-system-deregulation-on-the-performance-of-commercial-banks-in-nigeria-essien-anyanime-i-7-2 >.
IBANGA, ANYANIME. "Impact Of Financial System Deregulation On The Performance Of Commercial Banks In Nigeria:- Essien, Anyanime I." Mouau.afribary.org (2023). Accessed 08 Sep. 2024. https://repository.mouau.edu.ng/work/view/impact-of-financial-system-deregulation-on-the-performance-of-commercial-banks-in-nigeria-essien-anyanime-i-7-2