CHAPTER ONE
INTRODUCTION
This chapter provides the background to the Nigerian banking industry in the year 2001 with the Nigerian banks in focus.
It is indisputable that inspite of the competition going on in the already existing banks within the industry. Many new generation banks still spring up. These are as a result of several factors like nature of services rendered by the banks their expansion plans, the quest to meet up with profit margins acceptable by the body of stake holders, seeking markets for their services etc.
During this period the banking industry was misrepresented the banks who on longer consider the satisfaction needed by their consumer, but are constantly reminded of the measures of expansion and growth in line with their competitors.
The quest for opulence has crept not only into the bank, but in all the members of staff themselves and now manifesting into high rate of malpractices in the banking sector.
One important variable of the desired expansion in the banking industry is the cost of staffing, studies have shown that bankers are well paid to encourage and motivate them to their respective duties.
In order to meet up with these costs. Maximum efficiency needs to be put into avoid deficit.
As revealed by Nik Ogbulie viewing it from all indications available, the banking industry is growing in leaps and bounds. But what is yet to be fully determined is whether this growth is informed by increasing rate of efficiency in banking management or increasing demand of banking services by users of the industry. This becomes important because the perceive rate of growth is not industry-wide.
While some banks have remained big and strong still maintaining their mundane services approach. The one that pep up services are still not finding the bottom line easy and heap.
The major research problem is to investigate and identify such factor that influence proper management function of the banking industry and to focus on the nature and forms of professional misconduct in the industry. It has been confirmed in Nigerian banks that professional misconduct takes an upward trend in the sector and further discussed it on the part of senior, middle and junior management staff. These, Mr. Akintola Williams attributed to a number of lapse on the part of director and boardroom rows. He reviewed existing procedures for preventing identified misconduct and suggested modalities for dealing with the problems.
Emphasis on individual responsibility was made. The pressure occasioned by the absence of social security, the social demands of the extended family system and poverty equally provide added reasons and motivation for fraud thereby causing the industry a big harm.
The question developed in the course of the research are as follows.
The purpose of this study is to identify the activities of the banking sector in the year 2001 and to breakdown the boundaries between each segments of the industry e study will enable us to look intently into the operation of the past years and to further enhance the managerial decisions of the present period. It is no doubt that information plays a vital role in a development plan. The essence of reviewing the banking sector with restriction to a particular year like 2001 is an important measure for the betterment of banking activities with in the Nigerian economy.
It is of paramount importance also to say that, the review will help to suggest ways in which such lapses that go in the financial sector could be cradicated. It goes a long way in defining the activities and powers of individual banks and those that have more financial strength is assets-order of banking with in the Nigerian economy.
There are a lot of financial intermediaries within the economy but the study is a direct research on the Nigerian banking industry for the specified year (2001) as a focus. It is believed that the economic strength of any nation depends Majorly on the financial structure. This research is based on the banking financial structure. This research is based was taken because there is a very high concentration of banks in the Nigerian environment.
This study does not encompass non-banking/financial institution but banking /financial institution irrespective of the strength variations and geographical locations.
It is not usual to encounter certain problems in the course of accomplishing this kind of an undertaking. The nature of problems encountered manifest themselves in various shapes and forms which range from the indifferent attitude of most Nigerians to research. Lack of attention from possible respondents, bias incorporative attitude of some people in providing relevant information and data required for the study and of course. Lack of adequate finance.
Another limitation or problem is poor literature on local errors due to sample size used in computation of some banks in the sector. This resulted from some banks refusal to give some vital information regarding their operations.
In some other cases, where the questionnaire is being treated. It is treated with nonchalance and a deep sense of laxity with the opinion that the researcher is trying to unveil their concealed practices.
It is of great significance to note that this piece of work is not meant to write up a text concerning the banks sector.
Rather, it is meant to review the operations within 2001 in the industry, this work may draw some references of importance from past year that are close by and recent years after the period under study in an attempt to affirm the analytical report required of this project. It is not also a part of this work to judge or decide which bank is most appropriate or profit oriented for consumers. The work is to have a close are about the banking environment. Any kind of probing or misrepresentation will not be entertained in this project work.
From the problem stated above as what prompted the need for this study. It is obvious that this study is a worthwhile financial analysis. It is understandably a main effort to learn something sensitive about problems facing main effort to learn something sensitive about problems facing management of banking sector in the Nigerian economy. The value of results depends upon the skills with which the financial research project is designed and implement effective project research involves the following five steps: problem definitions research design, field work, data analysis and report preparation.
Also the sector has created a lot of opportunities including employment in the economy within the period under review and has contributed to improvement in living standard of people within the economy. This finding will assist firms in the industry to improve their marketing strategies of winning competitors through the first hand information about depositor’s perception.
There are a lot of importance associated with this study amongst which are as follow:
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