1.0                                 INTRODUCTION


Financial institutions are institutions that provide financial services for their clients or members. Probably the most important financial services provided by the financial institutions is acting as financial intermediaries. These institutions comprise of both banks and non-bank institution which both play a fundamental role in the development and growth of the economy and this is necessary to ensure its soundness as the effectiveness and efficiency in performing these roles.

The main aim of this banking or financial institution is the granting of loans and the interest of this loan form part of their source of income. But in the process of granting of this loan and advances, bank default.

Experience has shown that most projects in the country do not live up to expectation of the bank and the anticipated returns may elude them. And most times, the project may not be in a position to fulfill their loan drawings obligation with even the principal repayment not forth coming from their project. And this situation usually results in bad and doubtful debt. Thus putting the bank in difficult position as this debt is usually written off.

In light of the above, managers of this financial institution are faced with problems of managing the limited resources due to debt default.

And when this happens it is noted that the maximization of profit and maintenance of adequate liquidity which is the cardinal objective of bank will definitely be hindered. For this reason, it is important therefore for banks to initiate or come with different recovery measures to help check the issue of bad debt.

The growing propensity of banks to recover their debt and reduce their credit exposure has made it necessary to address the issue of debt management in financial institutions. This study therefore intends to examine and discuss the measures prudence adopted by banks.

First Bank Plc as a financial institution is not free from these debt management activities. Though enough measure has been put in place for the prevention of debt in the bank yet it is still noted that some cases of bad debts and doubtful debts are still recorded in recent time in the bank.

First Bank Plc which commenced operation in Nigeria in 1894 as a branch of bank of British West African Limited was incorporated as a private limited liability company in 1977 and converted to a private public company in 1970.

The bank shares are quoted on the Nigerian stock exchange (NSE). With 339 branches, the bank maintains the largest branch network in the banking industry in Nigeria. At the turn of the bank century First Bank of Nigeria Plc found itself in a unique position despite its size and reputation, there were challenges to maintain the leadership positioning a market that was dynamic as it was competitive. It was at this point that the bank launched its business transformation initiative called “century” clearly identified as an enable for the bank going forward.

First Bank of Nigeria Plc needed to adhere to the regulatory requirement imposed by the Central bank of Nigeria (CBN) as well as the common business practice followed by Nigerian banks. Since no two works is exactly the same way, the bank specific requirements were also important. The central bank increasingly proactively role in regulating the industry to bring it up to speed with international trend meant the bank had to remain agile in order to survive and come out a winner.

With sophistication of customer requirement and increased competition, the bank critical requirement was not only  to meet the existing demands of the customer but also to stay agile and meet the changing requirements going forward.

With Accenture as Consultant, First Bank of Nigeria embarked on a global search for strategic it partner who would enable them to make this quantum leap. An application selection model was developed, which involved looking at over 50 core bank solutions from across the world. Eventually with its finacle solution emerged as the clear winner.

One of the pillar of finacle value position to First Bank of Nigeria was it new generation solution architecture, designed to help the bank build an agile business through innovative offerings to the market and a significantly superior speed of response to customer, competitive proven track record of 100% successful implantation across the globe which offered the bank the alternative proposition of minimized risk.

First Bank of Nigeria piloted on finacle in six month and since then has rolled out the solution to over 170 branches on time and within budget.

First Bank of Nigeria’s unique requirements were catered to using finacle extensibility lookiong infrastructure that enables the bank to customize its specific requirement without touching the source code. This provided significant time to market advantage to the bank and enabled them to design and launch new product offerings quickly.

Regular version upgrades over the years have provided increased and more sophisticated functionality to the bank as the relationship has progress. The new generation flexible architecture of finacle has ensured 24/7 operability with close to 100% uptime, a feature of immense importance in a country not for fail safe network connectivity.

Finacle technological superiority and functional richness were important factors but its proven ability to scale up to first Bank of Nigeria’s explosive growth plans was the clinch. Finacle successfully met First Bank of Nigeria’s expectation of the solution being able to scale up and be the vehicle of grown to meet the emergency global challenges in the financial arena.