A COMPARATIVE ASSESSMENT OF THE PERFORMANCE OF DEPOSIT MONEY BANKS IN NIGERIA Dr Umar Mohammed Ali

Аннотация

INTRODUCTION of an efficient payment system and facilitating According to Ejem, Jombo and Oriko (2012), the the implementation of monetary policies. In banking sector in any economy serves as intermediation, banks are involved in the catalyst for growth and development. Banks are mobilization of savings of the surplus economic able to perform these roles through their crucial units and channeling such funds to the deficit functions of financial intermediation, provision economic units particularly business https://www.theamericanjournals.com/index.php/tajmei 14 THE USA JOURNALS THE AMERICAN JOURNAL OF MANAGEMENT AND ECONOMICS INNOVATIONS (ISSN- 2693-0811) VOLUME 06 ISSUE05 enterprises for the purpose of expanding system while the financial system is the life wire productive capacity for economic growth and of the economy and the entire nation. A development. In operating the payment commercial Banks performance is evaluated for mechanism, the banking system liability serves several reasons depending on personal as a medium of exchange. In execution of objectives. An entity like a bank regulator, for monetary policies, banks serve as agents example, may need to identify and call attention through which the nations monetary policies to banks that are experiencing chronic financial are implemented. For effective performance of problems in order that they may fix them before the above functions, banks have to maintain they get out of control. Such is the case with so proper liquidity to keep their doors open in the called bank runs. Shareholders, on the other short run. This would help maintain adequate hand need to assess which banks they can deem profitability to enhance solvency in wooing suitable to financially invest in. Unsurprisingly, their existing and new customers and deposit money banks evaluate their own shareholders. Apart from maintaining liquidity, performance over a given period so that they banks are also profit oriented businesses. may determine the efficacy and long term viability of management decisions or goals so The role of banks in the financial system of any that they can alter the course and make changes economy cannot be overstressed as they whenever it is appropriate. With a constant and facilitate the financial intermediation process of routine monitoring of performance, underlying reallocating resources from the surplus to the problems may remain invisible and lead to deficit spending units. There is a common belief financial failures further down the line. The among economists that continuous growth and overall objectives of this research is to compare development of any countrys economy the performance of five deposit money banks increasingly depends on its full integration into using financial ratios that will indicates the the local, regional and global market-place. The performance developments over the period reason is that variety of investible funds will be 2005-2015. Moreover, the study will make sourced for development and increase of the comparative assessment of the performance productive capacity of its component real among the banks, furthermore; the research is sectors such as the industrial/manufacturing going to measure the overall stability of each sector, the agricultural sector including the bank. To measure the financial performance housing sector etc, all things being equal. The and make a comparison on the banks, the banking system plays the all-important role of research is going to use five deposit money financial intermediation of insuring that banks. In each group, different ratios are going adequate funds are mobilized and supplied to to be employed to measure the performance. the real sectors of the economy for productive The descriptive measurements are going to be purposes. Banks accumulate/mobilize funds used to measure the performance and the from various savers and lend to borrowers by stability-variability of these ratios over the way of provision of payment facilities, credit years 2005-2015 and capital to individuals, firms and governments for investment in the economy. It Roles of Deposit Money Banks in Economic is also the duty of the banking system to Development inculcate banking habit at the household and The commercial banks play a significant role in micro-enterprise levels (Soludo, 2010). the economic growth of countries through their Management of the banking sector is an integral intermediation function banks play a vital role part of management of the overall economy. in the efficient allocation of resources of Therefore, the performance of the sector is an countries by mobilizing funds from the surplus important factor in determining how the overall sector of the economy for onward lending to the economy performs. The reason is simple. The deficit sector. They transfer funds from those banking system is a component of the financial who don't have productive use of it to those https://www.theamericanjournals.com/index.php/tajmei 15 TH