In the era when planned economic development has been identified as a means of achieving economic take-off in developing countries, the study of some key institutions is imperative. This study is on the banking sector. Thus “An Evaluation of the Effect of Interest Rate on the Profitability of Commercial Banks”
Banks act as financial intermediaries collecting deposits from one group and lending it out to another group. In this role they are able to convert short-term deposits into long-term loans. They bring together people who have money to lend and people who need money. The banks thus act as intermediaries collecting deposits and paying interest on them and making loans and charging interest on the loans made to their customers.
Checkley (1998), Commercial banks are great monetary institution important to the general welfare of the economy.
It will be observed that interest rate is the key element in the performance in this intermediary function of the commercial banks. At high interest rates the cost of borrowing will be increased and prospective borrowers will shy away from borrowing and that in turn affects negatively the profitability of the banks and they also shows up when interest rate is down.
The banker is faced with maintaining a balance between solvency, liquidity and profitability. Consequently the commercial bank’s major challenge is how to manipulate the economic variables in order to ensure an optimum balance between solvency, liquidity and profitability.
It is in compliance with the above issues that First Bank of Nigeria Plc is being used as a typical example to emphasize.
AN EVALUATION OF THE EFFECT OF INTEREST RATE ON THE PROFITABILITY OF COMMERCIAL BANKS IN NIGERIA (A CASE STUDY OF FIRSTBANK OF NIGERIA, JOS MAIN BRANCH)
CHAPTER ONE RESEARCH DESIGN 1.1 INTRODUCTION In the era when planned economic development has been identified as a means of achieving economic take-off in developing countries, the study of some key institutions is imperative. This study is on the banking sector. Thus “An Evaluation of the Effect of Interest Rate on the Profitability of... Continue Reading
CHAPTER ONE 1.0 INTRODUCTION 1.1 BACKGROUND OF THE STUDY Before 1987, the interest rate management policy was one of the control functions by the Central Bank of Nigeria (CBN) which fixed the minimum savings rates and maximum lending rates for financial... Continue Reading
ABSTRACT This researcher work is a survey of an analysis of the effect of interest rate deregulation on the profitability of commercial banks. The research to work tried to find out among other objectives, the impact of... Continue Reading
THE IMPACT OF INTEREST RATE DEREGULATION ON COMMERCIAL BANKS’ LENDING OPERATIONS IN NIGERIA (A SURVEY OF UNION BANK OF NIGERIA PLC ENUGU PROPOSAL Interest rate was before 1st August, 1987, statutorily regulated by the Central Bank of Nigeria. But this out of the tune with the liberalization policy of the structural adjustment programmes of the... Continue Reading
ABSTRACT The purpose of this paper is to examine the effects of workforce diversity on employee performance. The survey research design method was adopted for the paper. The instrument used to gather relevant data for... Continue Reading
ABSTRACT The study sought to appraise the effect of interest rate on loan repayment in microfinance institutions. Stanford Micro Finance Bank, a microfinance institution in uyo was used as a case study for the study. The research was conducted using questionnaires and... Continue Reading
Abstract This study examined the effect of interest rate margin on the performance of deposit money banks in Nigeria within the sample period of 1980 to 2016. The general objective was to verify how interest rate margin affects the performance of the deposit money banks. The data for this research work (Profitability Rate, Interest Rate, Monetary... Continue Reading
MONETARY POLICY IN NIGERIA BANKING INDUSTRY ( A CASE STUDY OF FIRSTBANK OF NIGERIA OWERRI BRANCH ) INTRODUCTION Currently, monetary policy has been taken to be a very vital measure in controlling the Nigeria economy this is one of the principal functions of the firstbank of Nigeria (CBN). The CBN caries out this responsibility on behalf of the... Continue Reading
CHAPTER ONE 1.0 INTRODUCTION The rigorous and strains of borrowing, especially in Nigeria and Africa in general are not doubt enormous. The fault is not that of the lenders (banks) alone as critics claim that the borrowing public are partly responsible for the frustrations. A large portion of the borrowing public are substantially under-educated... Continue Reading
PROPOSAL My aim of researching on this topic; the criteria of borrowing and repaying business loan ad a guide towards economic development ( a case study of first Bank of Nigeria plc Enugu) Is... Continue Reading