Tag Archives: financial reforms

Banking Sector Reforms and the Performance of Banking Business in Nigeria – An Econometric Analysis (Published)

The study examines the effect of financial reforms on banking sector efficiency in Nigeria from 1986- 2016. The objective of the study is to evaluate the extent to which exchange rate, (EXCH), interest rate (INT) and liquidity (LQT) have affected the efficiency of banking operations in Nigeria. The dependent variable in measuring banking sector efficiency is proxy by Nonperforming Loan (NPL). The OLS regression was adopted for test of the three hypotheses formulated. The findings indicate that financial reform targets have significantly affected banking sector efficiency in Nigeria in the long run. The study recommends that the regulatory and supervisory framework should be strengthened while interest rate policy should be made to stimulate savings through high real deposit rate and lending rate so as to promote financial deepening and thus banking efficiency.

Keywords: Banking Efficiency., Exchange Rate, Interest Rate, Liquidity, financial reforms


The transformation of the financial sector of the Nigerian economy has always occupied a cardinal position in the economic policies of all political administrations in Nigeria. Using electronic banking as a platform, the cashless policy was introduced to further deepen the financial market microstructure. This study examined the impact of cashless policy on the profitability of Nigerian banks, against the backdrop that these banks in a cash based economy are known for their huge profits even in the face of associated high cost of operations. Basically, will banks in the cashless regime still make as much profits as they use to make? To address this, secondary data were collected and analyzed using content analysis comparing profits under cash based policy with a cashless regime. The results revealed that cashless economic policy positively impact on banks’ profit through reduction in cost of operations and banking the unbanked populace.

Keywords: Cashless, Electronic Banking, Information Communication Technology, POS, financial reforms