Analysis of Banking Sector Reforms on Nigeria Economic Growth: An Issue for Competitive Global Market (1980-2020)

Abstract

Banking sector reforms faced some difficulties despite its laudable achievement. In Nigeria, wrong perception and stiff resistance to the policy could potentially determine prospective investors in the banking industry. The objective of the study is to analyse banking sector reforms on Nigeria economic growth for competitive global market from 1981-2020. The study made use of secondary time-series data sourced from annual CBN statistical bulletin. Augmented Dickey Fuller (ADF) and cointegration test were employed to determine the existence of long run relationship among the variables. The study used Econometric View (E-view 12) for descriptive analysis of the variables. The findings revealed that among others that credit allocation to private sector had a statutory trend from 1981 to 2006 and later experienced a gradual upward movement from 2007 to 2020. This shows that banking sector has contributed to the real sector of the economy through credit given to private sector. It shows that credit is significant to economic growth. The study concluded and recommended that time lag should be permitted to exist from one reform period and the next reform period to allow for appropriate planning and as well policy consistency.