The recent Banking consolidation exercise in Nigeria, no doubt has generated a lot of debate. The consolidation just like any other previous one has a lot of prospect for National development because of the strategic position of banking industry in the Nigeria economy. While the consolidation exercise is a welcome development, this project aimed to offer advice to the monetary authority on the exercise, by tracing the historical development of banking industry in Nigeria, highlighting some previous in the banking sector and their effect on the industry it self and the economy at large. Similarly, this project discusses the benefits and problems that are likely to introduce from the implementation of the consolidation while prescribing some measure for effective and efficient implementation that will enhance the national development. The past consolidation challenges that may arise from the consolidation exercise of the Nigerian banking industry include:
v The major challenges of bank consolidation is how to foster competition with fewer, mega banks, that fewer banks are likely to be pressured to expand their branches.
v Bigger banks might not necessary fit more efficient since they have no incentive to improve efficiency within limited competitive field.
v Consolidated banks might not have capacity building for risk management for both the regulators and operators.
v Small and medium scale enterprises may be neglected in the area of financing in mega banks
v Consolidation exercise may lead to unemployment in the country and it cause another social problem to the economy.
1.1 Objectives of the Study. 3
1.3 Statement of the Problem.. 3
1.4 Significance of the Study. 4
1.5 Limitation of the Study. 4
1.7 Hypothesis Formulation.. 5
2.1 Definition of Consolidation and Forms of Consolidation.. 10
2.2 Meaning of Merger and Acquisition.. 11
2.3 Meaning of Recapitalisation and Capital Bases. 12
2.4 Factors Necessitate for the Consolidation.. 12
2.5 Reasons for Consolidation.. 14
2.6 Objectives of Consolidation.. 15
2.7 The Benefits of Consolidation to the Nigerian Economy. 15
2.8 The Benefits of Consolidation to the Nigeria Banking Industry. 16
2.9 The Benefits of Consolidation to the Nigerian Banks Shareholders. 18
2.10 The Benefits of the Consolidation to the Nigerian Bank Stakeholders. 18
2.11 The Befits of Consolidation to the Nigerian Bank Directors. 19
2.12 The Benefits of Consolidation to the Regulatory Authorities of the Nigerian Banking Industry 19
2.13 The Benefits of Consolidation to the Nigerian Banks Employee. 22
2.14 Problems of Consolidation in Nigerian Banking Industry. 22
2.15 The Strategies Options to the Post Consolidation Challenges of the Nigerian Banking Industry 23
3.4 Validity and Reliability of the Instrument28
3.6 Limitation of Research.. 29
3.7 Method of Data Analysis. 29
4.0 Data Analysis Presentation and Interpretation.. 31
4.2 Analysis of Questionnaire. 31
5.0 Summary, Conclusion and Recommendation.. 45
5.4 Area of further Research.. 48
Appendix
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