BANK DISTRESS AND BANKING HABIT IN DELTA-STATE

0
476

BANK DISTRESS AND BANKING HABIT IN DELTA-STATEĀ (EDUCATION PROJECT TOPICS AND MATERIALS)

 

CHAPTER ONE

INTRODUCTION

1.1Ā Ā Ā Ā Ā BACKGROUND OF THE STUDY

The place of bank in the life of any nation cannot be over emphasized for instant, commercial bank started in Nigeria sometimes in 1891, the early generation banks contributed tremendously towards the economic development of the country. However, with the advent of second and third generation banks, there were sign of distress. Indeed distress in banks became a big source of concern of the entire financial system even though the scale was generally midst until 1989. Before this time, serious incidents of distress were relatively few and generally amendable to control by the monetary authorities. In the banking industry for example, the number of banks adjusted technically distressed rose steadily from 8 in 1990 to 42 in 1994 and 51 by the end of 1995 etc. As a result of the central position of banks in the financial sector, it would be safe to assume that issues as the relate to banks is to a large extent, effectively of the financial industry.

The banks in financial distress between 1994 to 1999 accounted for aboutĀ N16.7 billion or 10.3 percent of the deposit liabilities of the banking system and N15.6 billion or 15 percent of the systems outstanding loans and advances. More than two thirds of the aggregate loans of such banks were non-performing while their aggregate adjusted capital stood at N4.7 billion. The extent of distress in the primary mortgage institution, community banks and financial companies is not different from that of the conventional banks invariably, a good number of these institutions have been closed down while cases of breach of contractual obligation to depositors abound. Therefore, this study aimed at identifying the banks distress and banking habit of potential customers using the situation in Ughelli south Local Government Delta State.

1.2Ā Ā Ā Ā Ā PURPOSE OF THE STUDY

This project work intends to know the meaning of banks distress and banking habit consequently, the purpose of this study was to determine the effect of banks distress and banking habit of Ughelli south people.

1.3Ā Ā Ā Ā Ā STATEMENT OF THE PROBLEMS

The problem of the study relate to find out the effect of banks distress and banking habit of Ughelli south local government area. In the late 1990s and early part of the 2000, the country suffered greatly from a stagnated and crumbling economy. The banking sector which forms a part of the nations economy was adversely affected to the extend that, its effectiveness or efficiency became questionable as many banks went into liquidation and folded up. During this period, the country witnessed a trend of ā€œfailed banksā€.

Many other economic issues contributed in this aspect, there was high level of inflation in the economy due to ever increasing prices of goods and service in the market, this in the long run affects savings. Since the banking sector deals mainly with money, for some time now, the value of the naira has fallen in the international market. This devaluation of the nations currency has generally affected monetary transactions. Apart from these, the issue of high rate of unemployment and poor standard of living have reduced the purchasing power of the people. That is why income per capital is low in the country. This again is reflected in the peopleā€™s savings capacity.

In addition to these problems, there was also an instruction from the apex bank governor Prof. Charles Soludo in continuation to the economic reform programmes of the present democratic dispensation to define a particular shareholders fun to be met by the 89 commercial banks in Nigeria in which case December 2005 was given as an ultimatum or deadline to meet up with the N25 billion naira capitalization fund. But only 25 banks out of the 89 banks in the country met this requirement while the remaining became distressed or folded up.

DOWNLOAD COMPLETE PROJECT MATERIAL

BANK DISTRESS AND BANKING HABIT IN DELTA-STATEĀ (EDUCATION PROJECT TOPICS AND MATERIALS)

Leave a Reply