Financial Regulatory Bodies And Bank’s Health in Nigeria

International Journal of Research and Innovation in Social Science (IJRISS) | Volume IV, Issue III, March 2020 | ISSN 2454–6186

Financial Regulatory Bodies And Bank’s Health in Nigeria

Oyetunji, Oyefemi Ismail, Adepoju, Jadesola Abiodun
Department of Accountancy, The Polytechnic, Ibadan-Nigeria

Abstract- Nigerian Financial sector has grown significantly, contributing to the growth of the economy for decades and it remains one of the engines of growth especially the banking sector. Over the years, apart from remarkable achievements recorded, the sector also witnessed differs of crisis at various periods which therefore demands financial regulatory authorities to ensure a healthy sector is maintained in order to increase users’ confidence in the sector. The paper examines the impacts of financial regulatory bodies on banks’ health in Nigeria with particular emphasis on the periods from 1986 to date when the banking sector experience different forms of banking crisis and banking failures; Although, the paper claimed 1989 to 2014 as the period of general banking crisis but failure occurred throughout the period to some banks even down till 2018 ,which put the regulatory authorities on their toes at all the times. Primary data administration of unstructured questionnaire on selected respondents was adopted, and secondary data. It was retroactive and progressive in analysis. It is therefore recommended that periodic monitoring of both internal and external operations are necessary in light of environmental changes. This would facilitate a robust measure of banking health in Nigeria and thus regulating the banking sector in future.

Keywords: Financial Sector, Banks’ Health, banking crisis, banking failures, Regulatory bodies.

I. INTRODUCTION

Financial sector remains one of the crucial engines of growth in the economy. The sector fills in as an impetus for growth and development. An important part of financial system is banking sector of any economy. Banks play significant roles of financial intermediation, arrangement of an effective payments, and or installment framework and encourage adequate pursuits of monetary policies in the country. The nature of the economic transactions being carried out in the recent ages made it difficult for people to do without banking sector; The economy ends up bigger, more intricate and market-oriented, the financial sector will therefore play a vital role in supporting development by channeling household and foreign capital into gainful investments. Hence, there is need for banks to enhance depositors and investors protection, encourage healthy rivalry competitions, and guide against systemic risk. This becomes important as the social cost of the banking crisis is difficult to estimate, as the huge amounts of public money are being used to bail out distressed banks (Sikka, 2009).

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