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An Evaluation Of The Impact Of Supervision And Control Of The Central Bank On The Performance Of Commercial Banks
[A CASE STUDY OF ACCESS BANK NIG PLC LAGOS BRANCH]
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The
control of the banking industry by CBN is carried out in partnership
with the federal government, which has the overall authority over the
system. Thus the CBN initiates the guiding policy measure and implements
them only as approved by the government. The CBN measures to control
the banks through a number of stages which include the identification of
the objectives and targets of policy. Policy formulation, policy
implementation and review as well as other extra measures for commercial
banks (ogwuma 2004:2).
Supervision and control by the CBN impact
significantly on the activities and performance of commercial banks
between 1986 and early 2010, the supervisory and control measures of the
CBN seemed ineffective on a number of occasions and this contributed to
the hitherto, distress in the banking sector. Since 2004, there has
been series of new supervisory and control measures introduced by the
CBN into the banking system with the aim of improving the performance of
the banking sector.
Against this background, however the study,
however, the study is geared towards examining the impact of supervision
and control of CBN on commercial banks in view of how their performance
is affected from the negative and the positive perspectives with
concentration on the roles that CBN played from 2004 to 2011.
1.2 STATEMENT OF THE PROBLEM
The
supervision and control of commercial banks by CBN sometimes impact
adversely on the operations and performance of the former. This is as a
result of difficulties associated with the supervision and control
mechanism.
With respect to supervision, it appears that the CBN
apparatus are not effective. Banks examination are often not timely, not
regularly carried out or haphazardly done.
Secondly, some of the
CBN examiners are not sufficient competent and thirdly, they are not
large enough to supervise all the commercial banks effectively. The
result is that deficiencies to the operations of these banks are not
timely discovered and adequately controlled. All these adversely affect
the commercial banks.
With regard to the control, often times the
measures are too stringent for effective operations and performance of
the commercial banks. Restrictive monetary control measures limit the
liquidity and capacity of commercial banks to grant loans or credit.
Besides, direct interactions in banking activities by the CBN, sometimes
have adverse effects too.
In the light of the aforementioned,
attempt will be made to appraise the impact of central banks supervision
and control on the performance of commercial banks.
1.3 OBJECTIVES OF THE STUDY
In lieu of the problems stated above, the objectives of the study are
1.
To analyse the objectives of supervision and control of commercial
banks in view of the existing monetary policies of the CBN.
2. To
examine the effectiveness of the supervisory and control techniques of
the CBN specifically the ability detects malpractice on time.
3. To assess the impact of supervision and control on the performance of commercial banks with regards to liquidity.
4. To appraise the ongoing reforms of the CBN.
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ABSRACT - [ Total Page(s): 1 ]This research project tends to evaluate the impact of supervision and control of the Central Bank on the performance of commercial banks. Access Bank Nig Plc Lagos Branch was used as the case study. To aid this research both primary and secondary data were collected. The instruments used to collect data are questionnaires and oral interviews. The respondents comprised of male and female from the bank and the population put together is 150 and sample size is 109. The research design used for this ... Continue reading---
