The Implication Of Monetary Policy And Credit Repayment By Deposit Money Banks: An Empirical Analysis

ABSTRACT

This research work is centered on monetary policy and credit repayment by deposit money banks. The researcher decided to identify the degree of influence of the monetary policy tools on deposit money banks and to identify problems encountered by the deposit money banks in adhering to the monetary policy guidelines. To achieve these objectives, tile researcher distributed sixty questionnaires to staff in six deposit money banks in Umuahia. The coefficients of bank margin, bank rate and sectoral allocation were positively and significantly related to credit repayment at 5% level of probability. The coefficient for reserve ratio was also positively signed by significant at 10% level of probability. The co-efficient for moral suasion was negative and significantly related to credit repayment at 5% level of probability. The results therefore calls for policies aimed at increasing the bank margin, reserve ratio, bank rate and sectoral allocation in the banking system.