ABSTRACT
The aim of the project
is to provide information to the public on the “effect of bank failure in
Nigeria” it is geared towards bringing to light some of the activities or
services rendered by the banking industry bank failure causes and the effect to
it. The project is made up of five chapters.
The chapter deal with
the interaction, this takes about the background information about the
evolution of the banking system and bank failure.
The seconding chapter
deals with review of related literature in this topic high lighting different
writing opinion concerning bank failure causes and bank depositors it also
discusses the roles of banks in Nigeria economic development.
More so the third
chapter deals with the procedure and sources include background information
population and sample construction of instrument the statistical method used in
the analysis of the various data etc.
The further chapter
discusses the date analysis and interpretation it also spiffed the responses of
the respondents from the various research questions.
Finally chapter five
provides the summary of the whole study recommendation conclusions and also
area of further research.
TABLE OF CONTENTS
CHAPTER ONE
1.0 Introduction
1.1 Objective of
study
1.2 Statement of
problem
1.3 Significance
of study
1.4 Statement of
hypothesis
1.5 Scope of the
study
1.6 Limitation of
the study
1.7 Definition of
terms
CHAPTER TWO
2.0 Review of
related literature
2.1 Concept of
banking
2.2 The role of
bank in Nigeria economic development
2.3 Causes of bank
failure
2.4 Effect of bank
failure
2.5 Regulatory
effects in meeting the challenge of bank failure
2.6 Conclusion
CHAPTER THREE
3.0 Research
design and methodology
3.1 Sources of
data
3.2 Simple used
3.3 Method of
investigation
CHAPTER FOUR
4.0 Data
presentation and analysis
4.1 Data
presentation and analysis
4.2 Test of
hypothesis
CHAPTER FIVE
5.0 Summary of
finding, conclusion and recommendation
5.1 Findings
5.2 Conclusion
5.3
Recommendation
Bibliography
Appendix questionnaires
CHAPTER ONE
1.0 INTRODUCTION
1.0 BACKGROUND OF
STUDY
Failure as a word means
to be unsuccessful in attempts at achieving any the objectives or aspirations.
Another variance to the inability, refusal fault or weakness which prevent the
achievement of any set objectives or aspiration.
Both of these draw attention to the operative
world” unsuccessful inability refusal fault and weakness “therefore bank
failure is the inability of a bank to meet its objection to it customers,
owners and the economy occasional by fault or weakness in its operation which
had wand it illiquid and later insolvent.
There is not doubt that fraud has exasperated to desperate situation in the
Nigeria Banking sectors. Fraud and embezzlement are not widespread. Both
are unturned in the fraud crises jamboree. Furthermore, fraud in its
itself may not widespread. Bank are unturned in the fraud crisis may not
be a sufficient condition for a banking crisis. The researcher submits
that extremely bad management until adverse economic conditions led to
unexpected capital on flows or loan losses. Thus even if every bank which
failed is judged to have suffered from mismanagement or fraud, or operated in a
over populated banking market, it may well be the case that adverse, it may
well be case that adverse economic conditions will be the proximate cause of
many bank failure.
Employees as well as clients of firms in all industries engage in fraudulent
practices all over the world. Whilst if cannot, strictly speaking be said
to be an ordinarily expected human behaviour, including the socialist societies
world make one state that is an inhuman behaviour. Although the existence
of frauds in banks it not an uncommon or unexpected phenomenon, Ogwuma, P.
(1985:21) says it is worrying because of all the various problems confronting
the Nigerian banking industry today, that of fraud is easily the most
intractable. The banking industry worries more about fraud because of the
rather obvious damaging consequences of the acts on the health and existence of
the institutions.
Frequent occurrence of fraud ultimately distracts the attention of the
management and leads to increase running costs. Time and emergies that
would have spend improving customer services would be experienced on preventing
fraud. Moonies that also would have gone into service improvement
activities would be expended in setting fraud control procedures systems.
Banking industry, like others worries about fraud because it varies widely in
nature, character and methodology. Moreover, the control of an identified specie
seems to give birth to another that is invariably more sophisticated and
complex. Thus each case can be seen to be a variant of another and
undoubtedly on instrument study in human negative use of ingenuity and
endowant.
According to Crosse on Hampel (1973:2420), five major types of frauds are
perpetrated in bank,
They include:
a.
Borrowing a few naira which are returned overtime, the sums involved incrase
and the willingness and ability to “repay’ declines.
b.
Forgeries of customer’s signature to with draw from his /her accounts.
c.
Granting of loans to fictions borrowers and
d.
Granting of loans without adequate security and information from the customers.
THE EFFECTS OF BANK
FAILURE IN NIGERIA
Fraud in banks are caused by two sources, the internal and external sources
though distinguishable in theory, Adewuni (1986:2) posits that “these sources
are very often not separable in practice “that is to say a unintentional (ie
due to carelessness or error of judgment of an insider a bank employee0. Indeed
it was affirmed by Soneye, O. O. (1985:3) that “the public believes and rightly
too that most fraud in banks are with the active connivance of bank staff
otherwise. How doe any boy explain for example, how a cheque drawn in favour of
the federal government of Nigeria is paid into some private ones explain how a
completed different institution or individual collects a draft, prepared in the
name of an institution or individual? This is not an exception of the rules, it
is a frequent occurrence”. The source of frauds in bank can be classified
into institutional factors/ lapses.
A.
Institutional Factors/ Lapses: Are causes that can be traced to the internal environment of the
organization and are to a great extent, within the control of the management of
the bank. The major institutional causes of fraud are “poor
management”. This is often manifested in the following ways as identified
by Adewuni (1986:3).
- Lack of adequate
supervision;
- Inadequate control in
the form of effective policies, procedure and systems.
- Lack of adequate
experience leading to lumintentional fraud;
- Understaffing of
branches leading to compromise of standards.
- Overstaffing by
employees on a particular schedule.
- Poor salaries and
conditions of services
- Frustration and
- High inter-dependence
of extended family units in the nation” to buttress this, Ogwuma P. (1985:6)
says, “but the pity of it is that many ordinarily honesty staff have become
fraudster because of the demand and expectations of their relations and society
in general while other have fallen victions of inter desire to “live up to the
jobless” .
B.
Societal and environment factors/ lapses are factors in the environment in which banks operate. The
bank is an integral part of societal and not an is land. The following
have been identified as the societal element that causes frauds in banks.
- Misplacement of social
values as what.
- Society appreciate and
generally worships in money.
- Society’s voerstation
of bank staff and the desire of those live up to the standard of such a wrong
images?
- Inability of law
enforcement agents to detect fraud.
- Inadequate punishment
of perpetors of frau to serve as deterrent and
- Encouragement of bank
staff by outsiders.
- Individuals and fraud
syndicates. There is equally widespread concern about computer fraud mainly
because of difficulty in detection until losses have reached a large scale.
1.2 STATEMENT OF
THE PROBLEMS
Every country attempts
how to maintain a healthy financial system because of its importance in
economic growth and development of the bank failure in the society.
From the beginning of banking in Nigeria there have been serious crisis of bank
failure in the industry. This no doubt constitutes a set bank in our quest for
economic growth and development. Such a situation should not be allowed
to continue. To this causes of bank failure as the logical step towards
formulating realistic policy to arrest the trend.
1.3.1
PURPOSE OF THE STUDY
The purpose of this
study is to focus attention on the effect of bank failure in Nigeria which is
threatening to hamper growth and development of the Nigeria economy. To
this effect the major objective of this study is to:
i.
Identify the causes of bank failure in Nigeria.
ii.
Formulate a model to identify failed banks.
iii.
Provide policy suggestions to minimize the occurrence of bank failure in the
country.
1.4 RESEARCH QUESTIONS
1. Can they central bank of Nigeria
and deposit insurance corporation help to review some failed banks.
2. Has the liquidity of the
bank depositors been impaired bank failure.
3. Does bank failure lead to
loss of confidence by depositors on the banks?
4. There is massive
retrenchment and unemployment as a result of bank failure.
5. Does bank failure effect
the magnetization of the economy.
1.5 RESEARCH HYPOTHESIS
H0: There no effect of bank failure in economic development of Nigeria.
H1: There effect of bank failure in economic development of Nigeria.
H0: Government contributes to the failure of some banks.
H2: Government do not contribute to the failure of some banks.
H0: There is no solution to bank failure in Nigeria economy.
H3: There is solution to bank failure in Nigeria economy.
H0: There is massive retrenchment as result of bank failure.
H4: There is no massive retrenchment as result of bank failure.
1.6 SIGNIFICANCE OF THE STUDY
The significance of this
study is to achieve a great success in contributing the little the researcher
can, if not a great deal in solving the bank failure problem in Nigeria which
will in turn being about an immense change in the Nigeria banking sector with
practical reference to standard trust bank Enugu.
It is a well hope that this research work will definitely enlightening the
staff an management of banks especially Standard Trust Bank Enugu. In
additional it will bring about more profitably contribution and improvement to
every other bank nationwide to know their problem and locations, furthermore,
this study will serve as means to tackle most of the inherent problems
effectively. Again it will help the society on large in the evens or to
be as favourably side of the failures syndrome on Nigeria banks is eradicated
completed.
Finally, through the researcher restricted the study to Enugu State and
Standard Trust Bank the result of findings will be of immense benefit to all
banks in Nigeria as well as students conducting similar research on the same
topic or related one.
Department | Banking and Finance |
Project ID Code | BFN0280 |
Chapters | 5 Chapters |
No of Pages | 105 pages |
Methodology | Chi Square |
Reference | YES |
Format | Microsoft Word |
Price | ₦5000, $15 |
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Contact Us On | +2349067372103 |
Contact Us On | +2349094562208 |
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