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Analysis of formal lending to the agricultural sector in Nigeria: 1978 - 1998
No full textThe objective of this paper is to estimate the relationship between formal lending to agriculture and some assumed determinants of agricultural credit lending during the 1978-98 sample period. Lending by financial institutions to the agricultural sector was viewed for the purpose of model development in this study as the supply of credit to agriculture. Thus, the sets of determinants of agricultural credit supply to the Nigerian agricultural sector was assumed to consist of economic theory, policy and other variables. The models specified were estimated using the usual least squares procedure. The interest rate variable was negatively related to agricultural credit supply during the 1978- 86 sub-period, contrary to expectations. This was explained based on the regime of interest rate regulation prevailing prior to 1987. However, there was a net positive response of agricultural credit lending to the lending rate after interest rate deregulation from 1987, inclusive
Gerald P. O\u27driscoll, Jr.: Bank failures: The deposit insurance connection contemporary policy issues Vol. VI, NO. 2, April 1988.
No full textThe author articulated the views of Friedman and Schwartz who are unfavourably disposed to general regulation of the banking system but accepts the existence of deposit insurance; which in their view was the most important structural change in the banking system to result from the 1933 panic . In a historical analysis into the problems that led to banking failure in the United States, and the resultant establishment of the Federal Deposit Insurance Corporation (FDIC), with other binding regulations on commercial banks, the author agrees with Friedman and Schwartz submission that annual bank failure declined from triple-digit to doubledigit to single-digit
Micro-Finance as a Strategy for Poverty Reduction
No full textThe paper established the facts that poverty is indeed increasing in Nigeria based on the poverty assessment study commissioned and sponsored by the World Bank in 1995. It further indicated in the introduction that the World Bank and the IMF group are focusing on poverty reduction as a prerequisite for debt relief The paper is structured into five sections with introduction being section one. Section two gives conceptual framework and reviews some country experiences of microcredit programs. Section three describes the efforts put in place in Nigeria-the World Bank group efforts and the IMF to alleviate poverty while section four offers ,the micro-finance model and principles, that could be adapted in Nigeria considering the Nigerian experience on financial intermediation. Section five concludes the paper. In the conclusion, the paper emphasized that indeed microfinance is a strategy of poverty reduction
The role of development finance institutions (DFIs) in the financing of small-scale industries (SSIs).
No full textThe post-independence Nigerian government adopted the import-substitution large-scale industrialisation strategy to accelerate the country\u27s industrial development. Industrial output as well as industry\u27s contribution to the gross domestic product (GDP) declined in the face of the strong national aspiration for the restructuring of the economy and reduction of the dependence on petroleum. Small and medium scale industries have since become the focus of national industrial policy. ln order to put our discussion into proper perspective, we need to know what we mean by SSls in the Nigerian context. The following are the current official definitions of industrial enterprises adopted by the 13th Meeting of the National Council on industry (NCl-13) in Makurdi, Benue State, in July, 2001. The author concludes that the future of Nigeria\u27s industrialisation process is largely dependent on the fortunes of the SSls sub-sector considering its inherent benefits to a developing economy. lt is the sub-sector that holds the promise of meeting Nigeria\u27s industrialisation challenges in this century. Consequently, all the parties involved in the promotion of the sub-sector (government, private sector, and the banking system) must jointly ensure that the subsector is given all the support it needs to play its role effectively
Examining the internal factors determining the disparity in loan performance across the commercial banks in Nigeria
No full textThe Nigerian banking industry experienced severe loan problems and unprecedented losses in the 1990s. The severity of the loan problems varied across banks due largely to differences in the bank’s financial strategies (or specific-attributes). This paper examines the empirical relationship between these strategies and problem loans at these banks. A simple model is specified and estimated, using a pooled cross-sectional data. The empirical evidence strongly suggests that differences in management quality and level of credit risk are the key determinants of problem loans and loan losses at the Nigerian commercial banks in the mid-1990s. However, there is also an evidence of indirect role of credit policy, which appears to suggest that collateralisation of loans is not a sufficient guarantee for loan repayment. Undoubtedly, stringent credit requirements may to problems of adverse selection and loan delinquencies
Nigeria\u27s economic growth: performance and determinants
No full textIn this paper, some recent developments in time series econometrics, which is of great potential for extending the frontier of economic research is applied to Nigerian data in order to estimate a production function type equation as well as examine the key macroeconomic determinants of economic growth in Nigeria. Of particular application is the vector error correction modeling technique. Apart from the determination of criteria for selecting the lag length, the paper also explored variance decomposition and effect of shocks through the impulse response function. Results from the econometric analysis revealed that output was elastic to capital injection in the short-term and that all the other macroeconomic variables were significant in explaining growth in Nigeria. The predictive power of the model was quite high and tracked the long-run growth path
Central Bank of Nigeria Annual Report and Statement of Accounts for the Year Ended 31st December 2001
No full textThe Report, as in the past, reviews the operations of the Central Bank of Nigeria in its efforts at discharging its mandate for the fiscal year 2001. The major objectives of monetary policy for 2001 were outlined in the Bank\u27s Monetary Policy Circular No. 35, which aimed to maintain internal and external balance, contribute to sustainable output growth and poverty reduction, and focus on the banking system, rate, rate regime, viability, and stability. Key policy targets included growth in broad money, narrow money, aggregate bank credit, growth in bank credit to the government, private sector, inflation rate, and GDP growth. The Bank also provided guarantees for agricultural loans under the Agricultural Credit Guarantee Scheme (ACGS), supervised the recovery of outstanding balances on the Small and Medium Enterprises loan scheme (SME II), and launched the Small and Medium Industries Equity Investment Scheme (SMIEIS). The Bank also collaborated with other agencies in economic research and financial matters and improved the quality and dissemination of financial information in the economy. The Central Bank of Nigeria (CBN) implemented a flexible interest rate policy in 2001, gradually increasing the Minimum Rediscount Rate (MRR) to influence interest rate changes. The bank also focused on surveillance activities over banks and non-bank financial institutions, enhancing the efficiency of the payments and clearing system. The issuance of the N500 bank note in April 2001 and the encouragement of currency sorting machines by deposit money banks further strengthened the bank\u27s policy. The bank also encouraged the use of e-money and automation of the clearing system. The external sector policy in 2001 aimed to maintain a stable exchange rate and achieve balance of payments viability. Measures included the retention of the IFEM, allowing oil and oil service companies to sell foreign exchange for domestic expenses to any bank, and the use of Form \u27M\u27 for import transactions. The bank also supported economic growth and development by fostering credit accessibility for farmers and small and medium-sized enterprises through agricultural credit guarantees, supervision of credit facilities, and the facilitation of the Small and Medium Industries Equity Investment Scheme
Remarks by Dr. M.O. Ojo.
No full textThe special remarks at the opening ceremony of the eighth edition of the CBN Executive Policy Seminar organised by the Research Department in collaboration with the Personnel Department. The theme for the year\u27s Seminar was Governance and the Economic Policy Environment: Nigeria\u27s Experience intended to strengthen the capacity and expertise of executive staff of the Bank
Globalisation and the Nigerian economy
No full textThis paper examines the concept of globalisation and the place of Nigeria in the web of international relationships involving trade in goods and services and financial intermediation. It also identifies two major categories of globalisation and a number of opportunities and challenges of globalisation in the Nigerian economy
Comparative advantage in production and trade in Nigeria.
No full textThe Nigerian economy is generally large and very diverse. The country is endowed with a highly productive agricultural base and generally favourable climatic conditions, which provide the potential for intensive production, both for domestic consumption and for exports. This paper reviews the production and trade pattern in Nigeria with a view to identifying major structural changes with regard to the relative comparative advantage enjoyed by the sectors, the other parts of the paper focuses on some theoretical and conceptual issues. The rest of the paper is divided into five sections. Section 2 focuses on some theoretical and conceptual issues. Section 3 reviews the trend in production and trade while the constraints to productions and trade are discussed in section 4. Section 5 outlines options for improving production and trade while Section 6 concludes the paper