The Effect of Bank Capitalisation on the Performance of Banks in Nigeria.

The banking industry has undergone major upheaval in recent years, largely due to the lingering recessionary environment and increased regulatory environment. Many banks have failed in the face of such tough environmental conditions. These conditions

FBN continue to execute on previously articulated regional expansion strategy being consistent in their objective of effectively maximizing shareholder value while harnessing the benefits of diversification. First bank plc have only pursued expansion into countries that will disproportionately add economic value over the medium to long term and bolster the banking group’s strategic positioning in the Su-Sahara Africa (SSA) financial landscape (FBN, 2012). First bank of Nigeria brand of being dependably dynamic is one of its major selling points. Aside being the largest banking group by assets in SSA, the fact that a significant proportion of the banking public has business relationship with the bank attest to the strength of its brand. Part of their strategy is to be dominant financial services group across middle Africa. Having established itself over a 120 years history as the largest bank in Nigeria and already as the largest private sector banking group in Sub-Sahara Africa (Meristem, 2011).

The main goal of a business combination is business expansion. The process of two or more companies coming together under a common control in order to expand is known as business combination. There are two methods that a company can expand, which are by internal expansion and external expansion. First, internal expansion is the ability to increase business operations without any outside activities, such as advertising and marketing. Secondly, external expansion is when one company overtakes another company in order to be more successful. External expansion can be achieved through vertical integration, horizontal integration, or through a

Although joint stock banks opened branches in urban and semi-urban areas, they did not find it advantageous to cater to the banking and credit requirements of the urban middle/lower class comprising small traders/ businessmen, artisans, factory workers, salaried persons with limited incomes etc. The inability of joint stock banks to appreciate and cater

This chapter contains the theoretical, conceptual and empirical literature on merger and acquisition (M&A) and their importance to the performance of commercial banks. Some examples of other commercial banks in different nations of the world that embarked on corporate restructuring exercise and their impacts on the performance of the banks after the exercise are also reviewed. This section also discusses benefits and various challenges confronting merger and acquisition. The goal of this literature review is to summarize current research about variables in merger and acquisition, to determine whether M&A has either a positive or negative impact on the performance of banks in Nigeria to its customers and to present a comprehensive list of banks that emerged after the corporate restructuring exercise which will provide the framework for reference in this study.

A business combination is a union of business entities in which two or more previously separate and independent companies are brought under the control of a single management team. FASB Statement No. 141R describes three situations that establish the control necessary for a business combination, namely, when one or more corporations become subsidiaries, when one company transfers its net assets to another, and when each combining company transfers its net assets to a newly formed corporation.

Introduction Now a day under taking marketing activities is compulsory and a key to exist in the business environment especially in the financial sector where competition is strong. In Ethiopia there are 16 private commercial banks and three public owned banks. There is strong competition among these banks to take market share and earn profit especially for those banks that enter the market recently. In addition according to the National Bank of Ethiopia Directive, all commercial bank have to reach 500 million paid up capital in the coming four years. In order to achieve this amount of capital these banks must sell new share, persuade their existing share holders to

Consolidation means that the two firms agreed to play together in a single entity. One firm merges with another house to increase strengthen of market power helps to grow the profitability of the two houses has been dealt. All the same, one firm is acquiring to take another firm due to regulatory perceptions, declining shareholder value and ``too big to fail” (the depository financial institution is starting to fail) conditions government force this bank to merge with healthier banks are carrying this small or weaker banks through acquisitions. Although small banks cannot compete with large and foreign banks, because of scarcity of resources are determined such as size, capital of the banks, bank assets, liquidity ratio, special services to the customer, technology, economics environmental changes to involve the low banks.

There has been a number of banking reforms in Nigeria with varying attendant effects. However, the effect of the current reform originating from the conspicuous effect of the economic meltdown has become of great concern. While the reform of 2004 cannot be exonerated from its attendant casualties of job loss among others, the current reforms seems to have raised some dust. Following the financial stringencies in the economy and the role of banks in a depressed economy, the CBN governor, Mallam Sanusi Lamido Sanusi, on August 14, 2009 relieved some banks’ CEOs of their duties for wrong exercise of executive responsibility.

As a result, the sector was confronted by rampant bankruptcies, collapse, and breakdown of several banks. This was a source of concern for the regulators and the general public because several customers and investors lost their life savings to dubious bank operators. The appalling situation in the sector leading to 2004 compelled the bank regulators “Central Bank of Nigeria (CBN)”, to decisively intervene to restore the public confidence in the banking sector and the financial system of the country (B. Adeyemi, 2011). In 2001, a deregulation in banking sector saw the in the issuance of universal banking licences to several of banks to operate as retail bank

consolidation that have been recorded to date in the modern history of banking are of this kind, and

Finally, it was recommended that The bank 's control system should be of high priority both at management and operational levels, the regulatory authorities have a responsibility of exposing staff to the dynamics of modern day banking operations, The level of punishment meted out to fraudsters is not commensurate enough to deter others from committing such crimes in the future. The penalties already in place should be reviewed. In this regard, a Nigerian version of the Sarbanes Oxley act must be enacted and since the most important resource of any organization is the human resource, there must be a standard audit department staffed with the best material in terms of knowledge, experience, human relations, integrity, dedication and commitment to the success of the bank.

Department of Banking and Finance, Midlands State University, P Bag 9055, Senga, Gweru. 2 Department of Banking, National University of Science and Technology P O Box AC939, Ascot Bulawayo. 3 Department of Banking, National University of Science and Technology P O Box AC939,

With every new govt. banking sector gets new policies for its operation. Thus it has to cope with the changing principles

Today, its vital role in commercial banking activities lie in the direct effect it has on total economic growth and business development. Every year the (CBN) central bank of Nigeria being the monetary authority that is solely responsible for the insurance of guidelines policies and the interpretation of such, comes up with economic measure roles and regulation under which the bank in the country operate. Such policies direct the use of funds from depositors, stockholders, and creditors in order to control the size of loan portfolio thereby determining the general circumstances under which it is appropriate to make an advance. The monetary policies also aim at aiding the banks to maintain a sound financial and banking system promote confidence in sustenance of reasonable banking services for public as well as ensuring a high standard of conduct and professionalism in banking industry. These rules and regulations are contained in monetary policy circular being issued by the central bank at the beginning of every year.