European Journal of Business and Innovation Research (EJBIR)

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Macroeconomic Analysis of the Relationship between Interest Rate, Economic Growth and Bank Lending in Nigeria

Abstract

This study examined the relationship between interest rate, economic growth and bank lending in Nigeria. Secondary time series panel data on the study variables were sourced from Central Bank of Nigeria (CBN) Statistical Bulletin for the period 1985 – 2014. The study employed Ordinary Least Squares (OLS) technique to analyze data. The study found that interest rate had negative relationship with bank lending in Nigeria. While economic growth had positive correlation with bank lending in Nigeria. The study recommended a policy shift towards infrastructural development and an increased productive base of the notion in order to improve the financial sector performance by stabilizing the macroeconomic instruments. This it is hoped would not only help in enhancing the profitability of banks in the country but would also improve the standard of living of the Nigerian people.

Keywords: Bank Lending, Interest Rate, economic growth

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This work by European American Journals is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 4.0 Unported License

 

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Email ID: editor.ejbir@ea-journals.org
Impact Factor: 7.79
Print ISSN: 2053-4019
Online ISSN: 2053-4027
DOI: https://doi.org/10.37745/ejbir.2013

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