THE ROLE OF THE CENRTAL BANK OF NIGERIA IN THE DEVELOPMENT OF MONEY MARKET
This research work will take a look at the rate of the Central Bank of Nigeria in the development of money market. A good knowledge of the strategies which the bank uses in implementing and instruction the dwindling economy will be identified. It will also cover the constraints the bank faces in implementing the government programmes. The role of Central Bank of Nigeria in developing the Nigeria Economy cannot over stressed. The Central Bank being the bankers banker and the lender to last resort is a mirror that reflect the nations economy. The researcher made use of primary data through a field survey of the staff of account and internal audit department also conducted al interviews with senior officials of account department of CBN. I also went through the account books and audit procedures in the account and internal audit department of the organization. The oral interviews, however was aimed to further obtain same details which are not ascertainable through the questionnaire. Also data were obtained through the questionnaire.
The researcher reached on books and documents made available to them by the heads of the account and internal audit department. The secondary data could be obtained from libraries, source nails, newspaper and materials relevant to the research. It has been possible for the researcher to discover the need and implication of CBN in ensuring monetary expansion in the economy and effective operation of the money market. CNB cannot continue its activities merely to the regulating and operation of commercial banks, but also to carryout its primary duties. Base on findings recommendations have been to improve the role of CBN in development of money market.
TABLE OF CONTENTS
1.1 HISTORICAL BACK GROUND
1.2 STATEMENT OF THE PROBLEM
1.3 OBJECTIVE OF THE STUDY
1.4 SCOPE AND LIMITAITON OF THE STUDY
1.5 SIGNIFICANCE OF THE STUDY
1.6 DEFINITION OF ITEM
2.0 LITERATURE REVIEW
2.1 DEFINITION OF CENTRAL BANK IN NIGERIA
2.2 DEFINITION OF MONEY MARKET
2.3 OBJECTIVE OF CENTRAL BANK OF NIGEIRA
2.4 FUNCTION OF CENTRAL BANK OF MONEY MARKET
2.7 TUTORICAL REVIEW
2.8 EMPERICAL REVIEW
3.0 RESEARCH METHODOLOGY
3,1 RESEARCH DESIGN
3.2 DETERMINATION OF SAMPLE SIZE
3.3 AREA OF STUDY
3.4 POPULATION OF STUDY
3.5 SAMPLE OF STUDY
3.6 METHOD OF INVESTIGATION
3.7 METHOD OF DATA ANALYSIS
3.6 SOURCES OF PRIMARY DATA
3.7 SOURCE OF SECONDARY DATA
3.8 DEVELOPMENT OF RESEARCH INSTRUMENT
4.0 PRESENTATION AND ANALYSIS OF DATA
4.1 PRESENTATION AND ANALYSIS OF RESULTS
5.1 SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS
1.1 HISTORICAL BACGROUND
The Central Bank of Nigeria was established because of the anracteristic and difficult of the monetary system, which proceeded it. These case, the currency or legal tender obtaining in the colorizes before independence was issued by a currency board. lso the development of indigenous banking and growth in the financial mechanism could not be achieved without the assistance of a central bank institution west African currency board which was established to finance the need of the expert trade of repatriate fixing in west African for the objective of issuing a spade convertibility a currency providing ream where by the colonial government might share in the profit of the currency was not impendent currency with Nigeria currency was tied on the spoon string of the British bound. It has no room for monetary management.
According to professor W. O. Ugoaga in his book tilled “money and banking in Nigeria”, the system was operationally right and institutionally limited it result that the board lacked any power to initiate and execute monetary policy. It also did nothing to train African in the art of monetary management or to develop indigenous banking and other financial institution which resulted that west African currency board had no discretionary power over the total amount of money and could not perform any banking functions. The effects were that banking habit in the country was not develop.
Demand deposit constituted less than half the size of the currency e.g. nearly half of the deposited were held by government organization for the indigenous sector banking was even less significant because an over whelming part of deposit was held by Europeans and Europeans firms. No local investments out less were developed because it invested all its reserves in starting over sea in London.
The Central Bank of Nigeria was finally establish by Central Bank of Nigeria (CBN) ordinance in 1958 to issue legal tender currency in Nigeria to maintain external reserve to safe guard the inter national value of the currency to promote monetary stability and a sound financial structure in Nigeria to act as banker and an financial structure in Nigeria, to act as bankers and as financial advice to the Federal Government.
According to Professor G. O. Nwankwo in his book tilled “Nigeria Financial System. The Nigeria money was established by the Central Bank of Nigeria to enable government (as well as other financial institution) recoup them short fall in revenue and invest their surprises.
It’s therefore necessary to profit the extend the market has performed their function particularly. This period the government has been experiencing increasing short falls in revenue as a result of the glut in the world and market.
1.2 STATEMENT OF PROBLEM
The Central Bank of Nigeria according to Professor G.O.
Nwankwo his book titled “Nigeria financial system” in expected as on of the function to develop the Nigeria money market. The problem to the investigated here are the extent to which the central bank of Nigeria has performed its role towards having a higher in developed money market which according to seen in his hook lilted central banking in undeveloped money market is usually characterized by the availability of proper investment in the market e.g. cash, call money, treasury bill e.g.
Highly organized, banking system which make sit possible for central bank to control the economy effectively,. The number funds and securities as the money market may demand.
Action of foreign funds, which depicts the confidence of foreigners and the prospects unvisited in the market.
When one sub-market is disturbed e.g. shortage of funds in one sub-market will cause movement of funds from the surplus area to the shortage region.
1.3 OBJECTIVES OF STUDY
The project is aimed of achieving the following to their solutions to the central bank at Nigeria through the government with a vie to implementing those projects that will help in the development of a highly organized money market in Nigeria.
To help the entire population understand the activities of the central bank of Nigeria in the development of the Nigeria money market.
1.4 SIGNIFICANCE OF THE STUDY
The significance of the study offer relevant information about the roles of central bank in development of money market, which will turn contribute immensely to economic development.
Since we all know the central bank issue of currency, banker to other banks, banker to the government, lender of last result clearing and collection of cheque and other instrument, it becomes clearly that every individual should master the role of central bank in money market.
1.5 DEFINITION OF TERM
A. CENTRAL BANK: It is the apex financial institution which manages in the cost of money, the volume of money available within the economy, the direction of money and credit floor in the same economy with a used to realize the designed monetary and credit objectives.
B. COMMERCIAL BANK: Commercial Bank is an institution that accepts cash, near, cash assets and other credit and makes payment on demand using its money market institutions.
C. DISCOUNT HOUSE: These are financial institution, which pays the face value of a bill upon materially to the holder of such bill discounting.
D. MONEY MARKET: Is the arrangement whereby borrowers and lenders of money on short-term basis are brought into contractual relationship.
E. CAPITAL MARKET: Is a market for long-term capital. It suppliers invest with the opportunity to borrow and tender money on medium and long-term bases.
F. STOCK EXCHANGE MARKET: Is a market that facilitates buying and selling shares, stocks bond debenture and other securities.
G. CALL MONEY: This is calls money at call on short notice. It’s an arrangement where by commercial banks borrow money from one another on over night basis.
H. TREASURY CERTIFICATES: Is the certificates used for raising money form the money market by government for duration of between 1 and 2 years.
Project ID: ACC0104
No of Pages: 55
Format: Microsoft Word
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