1.0              Introduction

1.1       Background of the study

1.2              Statement of the problem

1.3              Scope of the study

1.4              The research objectives

1.5              Research hypothesis

1.6              Significant of the study

1.7              Definition of terms


Literature review

2.1              Introduction

2.1              Definition of Nigerian stock exchange

2.1.1        Basic requirement

2.1.2        Objectives of Lagos stock exchange

2.2              The securities and exchange commission

2.2.1        Composition of the commission

2.3              The central bank of Nigeria

2.3.1        Objectives of the bank

2.4              Development banks

2.4.1        The Nigeria industrial development bank

2.4.2        The Nigeria bank for commerce and industry

2.4.3        The federal mortgage bank of Nigeria.

2.4.4        Merchant bank

2.4.5        The growth of the capital market


Research methodology

3.0       Introduction

3.1       Population sample

3.2              Instruments for data collection

3.2.1        Primary data

3.2.2        Secondary data


Data presentation and analysis

4.1              Introduction

4.2              Analysis of results

4.3              Hypothesis testing


Summary of research, conclusion  & recommendation.

5.0              Introduction

5.1       Summary of research

5.2              Conclusion

5.3              Recommendation




A country must invest to build up productive capacity for growth to occur. It is this capacity that determines the level of output of goods and services in the economy. If investment which represents the net increase in an economy’s’ capital stock, leads to growth then there is relationship between capital accumulation and economic growth when sustain growth has occurred. It is expected that over time with appropriate policies that allow for more equitable distribution of income among a progressive larger percentage of the population, economic development would follow.

Hence, the fact that capital is needed for economic growth is not disputable.


In the early 1980’s the analyst frame work on which standard structural adjustment programmes of the world bank and IMF was drawn, placed tremendous resources in self sustained growth process. So every country needs capital to grow. The possession of relatively small stocks of various kinds of capital is a characteristic of under developed were as the condition of being developed means having accumulated established, efficient social and economic mechanism for maintaining and increasing large stocks of capital per head in various forms.

Therefore for under developed economy, a country’s capital stock will only contribute to the economic growth. If its investments are productive in this respect, the domestic economy must provide the right policy environment incentives and stability that can sustain and encourage the required flow of savings from the surplus spending units and then into long-term investment that will enhance productive capacity. The capital market contributes to the mobilization of savings by providing a variety of market instrument for the holding of financial assets in the economy. While improving opportunities for business to obtain equities and long term loans, which encourage long term productive investments.

Savings and investments are carried out by two distinct groups of people, thus the need for some form of medication, various types of financial institution the stock exchange, issuing houses, stock brokers, share registrars share distribution agents (commercial banks) institutions investors (merchant banks) Nigeria enterprises promotion board, (NEPB) Nigeria security and exchange commission, central banks of Nigeria etc. play this and allied roles and they all collectively come under the general designation of the capital market.

Though the  capital market resources are mobilized and allocated to meet the competing needs of various sectors of the economy (Agriculture manufacturing and others) capital market is the complex of institution irons and mechanism through intermediate terms of funds and long-term funds are pooled and made available to business, government and individuals and instrument already out standing are transferred.

This means that capital market in contrast to the money market caters mainly for medium long-term investment.


The problem as regards to this study is described and an attempt will be made to test the ascertain that business financial through capital market problems. How these problems affect the economics growth industries is also going to be tested.

So emphasis will be more in the role played by the Nigerian capital market, which is the core center of the studies and attest its contribution to the economic development and ascertain if there is any positive growth and awareness of the investors for this reason the researcher have the following set-out objectives to guide her investigation:

a.         Is the investing public aware of the activities of the capital market.

b.         Is a poor attitude to saving and banking an impediments to the capital market.

c.         Has inflation a negative effect on the desire of investors to invest in stocks and shares.

These and other likely problems would be investigated.

1.3              SCOPE OF THE STUDY

It is important to note the study intermediate and long term business financing in Nigeria is a wide topic the details of which cannot be fully covered under the limited time frame.

This is the reason why secondary only is used. The intension was actually to combine both primary and secondary data so as to have a whole coverage of the topic.

Nevertheless, it is hoped that this piece would provide an idea about the basic nature of business financing in Nigeria and how it affects the economic development.


In a research of this nature which is of national issue, the major objectives is to identify the problems existing from the core center of the subject matter. Once the problem is identified it will be easier to find the solution to it the focal point of the study will be the capital market,” as the subject matter intermediate and long term business financing and its’ effects on economic development of Nigeria. The study will identify the problems of raising intermediate and long term funds through capital market and further see its effect on the economic development of Nigeria.

In this regard there is need to determine and understand the capital market instrument among others long term and medium term financing.

The main sources of intermediate and long-term facilities in Nigeria are the capital market.

The medium (intermediate) term facilities have life expectancy of nine to fourteen (9-14) years while the long-term facilities have 15-25 year life span. The capital market embraces the entire financial system involved in the provision of long term and medium term facilities. Through he capital market, capital resources are mobilized and allocate to meet the competing needs of various sectors of the economy. The vehicles, which are the commodities in the financial system through which funds are mobilized and allocated, are called security. These securities are traded in the stock exchange market.

A stock exchange is a place where the enormous capital, which is required to operate the large industrial and commercial cooperation of, can be raised in such large amount and at such competitive terms cost condition length of negotiation etc that no other institution in a capital system can possibly match.

1.5              RESEARCH HYPOTHESIS

Having been explained that hypothesis represent the core of the research work and thus stand to be accepted or rejected at the end of the study. The following will be  put forward for the purpose of this work.

i.          Influence of intermediate and long-term business financing in Nigeria affect the economic activities.

ii.         Influence of intermediate and long-term business financing in Nigeria do not the economic activities.


The fact that Nigeria is well blessed with both human and material resources which are part of the major bedrock of the economic development (industrial growth) whether these are fully utilized in beyond the scope of this study.

However, an attempt will be made to look into the industries or bringing out some of the silent issues affecting the development of capital market which subsequently affect the business growth.

The significance of this research study will include among others this will contribute to the existing literature in the intermediate and long term business financing in Nigeria. It will also show how the various institution that constitute Nigeria capital market where established. This is more so when a clearer understanding and the operations of the capital market and its problem demand and supply are often sources of confusion  to students and the public at large.

The problem of raising equity capital from the stock exchange market in recent times has been a source of concern to many would be business promoters and shareholders. The result of this research work will go a long way in solving these particular problems.

The difference between the stock exchange market and the Securities and Exchange Commission has not bear very clear to many readers. This research work will try as much as possible to lay bare the major and minor differences of these institutional player in the Nigerian capital market.

The result of the findings will help the agricultural and manufacturing sectors of the Nigerian economy in sourcing the needed capital sot that their capacity utilization would improve significantly. Now lack of finance and raw materials has been the bare of our manufacturing companies. It is hoped that after this research work, this problems will be a thing of the past.

Of the findings from research work are able to tackle the above-mentioned problems, the researcher would have achieved the purpose of this efforts.

1.7              DEFINOITION OF TERMS

1.         NSE                            Nigeria stock exchange.

2.         NIDB                          Nigeria industrial development bank.

3.         NBCI                          Nigeria  hank for commerce and industry

4.         FMBN             Federal mortgage bank of Nigeria

5.         Debentures                  This is a legal document that certifies that a debt is genuine, holds any collateral that may be used a security for the issue and collect money from the company to pay interest and also the principal.

6.         Stock                           Equity capital of a company includes all funds contributed by the owners the evidence of this ownership consist of stock certificate that, among other things, show the names, type of shares and type of stock.

7.         Bonds                            A bond is a type of security that is debt of the issuing cooperation that matures at a stated future date and in which on which an interest is paid annually or senior annually.   

8.         Long-term financing        This term is used for funds that are secured from loans with maturity date several years in the future.

9.         Term-loan                                            These are loans of between two to three years maturity period.

10.       Leases-Financing                                This is an arrangement that provides a firm with the use and control over assets without the firm receiving the title of the assets.


11.       Preference shares                                These are compromise securities in which an investor relinquishes some of his rights as an unrestricted participants in corporate profit and acquires a prior right to a limited but seemingly assumed part in th profit. Preference shares stand midway between ownership and debt securities, and are designed for the benefit of the investor who wants priority over the ordinary shareholders.

In other words, there are some characteristics of preference shares; and they includes:

1.         Preference shareholders have claim on the assets and. Income of the firm prior to ordinary shareholders.

2.                The dividend rate of preference shares is fixed.

3.                They are sometimes issued with cumulative right ie. Dividend will accumulate until paid off.

4.                Preference stock may be redeemable or irredeemable, redeemable preference shares have maturity date while irredeemable preference shares are perpetuities.

5.                Preference shares are convertible. A firm can issue convertible preference share that can be converted into ordinary shares after a stated period.

6.                They do not have voting rights.

7.                At liquidation, preference stock holders have claims that rank after those of the bond holders.

12.      DEBENTURE:         A debenture is a long term bond that is not secured by pledge of any specific claims, it is secured by any property not otherwise pledged. The details of the loan are set out in a document, which the borrowing firm signs and gives to the lender as evidence of its indebtedness to the later, meanwhile, debenture have some features which are.

i.         Debenture holders are creditors of the firm and not equity holders.

ii.                  Debenture holders are creditors of the firm and not equity holders.

iii.                Holders have no voting rights.

iv.                It could be floating debenture in which cases the company’s issued.

v.                  In the event of liquidation they rank higher than shareholders in claims settlement.

vi.                It could be fix debenture which is secured on some particular assets it assets must not be disposed of without the concert of the debenture holders.

vii.              A debenture could be subordinated which means that in the event of liquidation, it would receive settlement after senior creditor have been paid the full amount owned them, but they rank ahead of preference stock holders in the event of liquidation. It attracts higher yield than ordinary debenture, which makes it more attractive, and could be converted into common stock.


13.      MORTGAGE:          This is a form of long term finance available to land and building owners using mortgage usually involves the gradual repayment of the principle and interest repayment by way of annuity. The annual interest payment is tax deductible. Some of the institutional providers of mortgage loans are mortgage finance companies, federal mortgage banks commercial banks and merchant banks.  Repayment of mortgage loans could be in mathematical form.


Using our service is LEGAL and IS NOT prohibited by any university/college policies

You are allowed to use the original model papers you will receive in the following ways:

1. As a source for additional understanding of the subject

2. As a source for ideas for your own research (if properly referenced)

3. For PROPER paraphrasing ( see your university definition of plagiarism and acceptable paraphrase)

4. Direct citing ( if referenced properly)

Thank you so much for your respect to the authors copyright.

For more project materials

Log on to

Or call




Leave a comment...