- The Complete Research Material is averagely 50 pages long and it is in Ms Word Format, it has 1-5 Chapters.
- Major Attributes are Abstract, All Chapters, Figures, Appendix, References.
- Study Level: BTech, BSc, BEng, BA, HND, ND or NCE.
- Full Access Fee: ₦6,000
Get the complete project »
![Download Code Ready Instant Download Active](https://codemint.net/assets/home/instantdownloadMain.png)
ABSTRACT
This study examined the impact of liquidity performance in commercial using First Bank of Nigeria Plc as case study. Secondary data used in this study were carried from text books, journals, magazines and newspaper. Our findings indicate that there was a positive relationship between liquidity management and the existence of any banks. Based on this findings we recommend that should be prudent in extending credit facilities to their client/customers to avoid problem of load loss management and competence in banking system should be enhanced to increase asset quality.
CHAPTER ONE
INTRODUCTION
BACKGROUND OF THE STUDY
The impact of liquidity position in management of financial institution
and other economic unit have remained fascinating and intriguing, though
very elusive in the process of in investment analysis visa- visa bank
port folio management.
There appears to be an interminable argument in the literature over the
years on the roles, meaning and determinants of liquidity and credit
management. The Nigeria financial environment has noticed increase in
credit which has become a problem to the country.
Credit control described as to maximize the value of the firm by
achieving a trade a trade off purpose of credit control is not to
maximize sales or to minimize the risk of bad debt.
In fact the firm should manage it credit in such a way that sales are
expanded to an extent to which risk remains within an acceptable unit.
These costs include the credit administration expenses bad debt, losses
and opportunity cost of the fund field up in receivables, the aim of
liquidity management should be to regulate and control these cost that
cannot be eliminated together.
According to Begg, fisher and Rudiger (1991:130) liquidity refers to
the speed and certainty with which an asset can be converted back into
money (cash, income) whenever the
Asset holder desires, money itself is the most liquidity asset o all
liquidity management seeks to ensure attainment of the short term
objective.
A liquid bank is one that stores enough liquid assets and cash together
with the ability to raise funds quickly from other source to enable it
meet its payment obligation and financial commitment in a timely manner.
Therefore according to Ngwu (2006:36) liquidity management is the act of
storing enough funds and raising funds quickly from the market to
satisfy depositor loan customer and other parties with a view to
maintain public confidence.
STATEMENT OF THE PROBLEM
Liquidity is considered as the success of as bank, therefore ay
ineffectiveness in its management consuetude’s a huge problem i.e. it
encounter a huge problem that affect the affairs of the financial
institution. This problems is therefore analyses here as the basis for
this research study.
The analysis commence from the era of banking in inception in Nigeria
through it growth stages and till what is it today. The initial bank
failures recorded were principal dues to inefficiencies in the
management of the liquidity of such bank which in one way or the other
had something to do with either liquidity inadequacy and the relative
inefficiency in their management.
As an institutional problem, it has persisted over the years, in
determining the survival or otherwise of banks. Although it must be said
that some relative degree of banking it is believed that any banking
institutions that is properly managed and has adequate liquidity should
be able to swim above troubled waters.
Problems sometimes also evolve from banks inordinate urge to make
phenomenal profit. In the process of doing this there is the tendency
for these banks to get carless in the resources utilization and
particularly their management of liquidity.
The resultant effect is usually loss substance and consequently, loss
accumulation, a situation which can lead to banking failure. The
marginal loans in the banking system calls to mind the important factor
that national government of all` time preoccupy themselves with banks.
This shows the degree of importance attached to liquidity and its
management by these governments and deviation from its ratio or
inadequacy of it management always spells trouble for the banking
concerned.
The far reacting consequences of inadequate liquidity management can
also be examined. Apart from profit declines. Other of attendant
consequences to a bank includes loss of confidence in the particular
bank its inability to fulfill both its short term and long-term
obligation, lack of trust on the part o depositors and other customers
alike; and the concomitant reduction in level of operations.
A recent example of the eminent distress facing Nigeria bank which is as
a result of improper liquidity position management as well as loan
loss- accumulation (marginal loans).
OBJECTIVES OF THE STUDY
Considering the nature of banking itself which is a risk taking venture,
i.e borrowing short and lending long one sees the indispensability of
liquidity for a banks effective and profitable operation liquidity is
needed to finance the gap created by mismatching funds. Again liquidity
adequacy is a sure way of minimizing the risk portfolio of any bank. The
need to put some family into the management of banks liquidity has
always been considered a serious issue by the authorities and this has
often influenced periodic prudential regulation. As a check on banks
against holding excessive cash, Central Bank presently stipulated
liquidity ratio of 24.69%, is considered by the Apex bank as being the
reasonable maximum any an expression of the bank liquidity assets which
comprise cash marketable securities and investments over the bank banks
total liabilities (Ngwu 2006:56)
The objectives of the study include
(a). To examine in details the liquidity position of banks in Nigeria using first bank Nigeria as a case study.
(b). To identify causes of illiquidity or factors that influence liquidity management.
(c). To examine how these banks are able to adjust their liquidity and control management in Nigeria financial environment.
(d). To analyses the consequences of inadequate of liquidity control management.
(e). To make some suggestion on policy guideline to the monitory
authorities who can after banks current liquidity and credit management
practices.
RESEARCH QUESTIONS
The essence that the respective bank should manage their balance sheet
inn such a way as to operate within that maximum range and still remain
liquid.
The basic questions this research attempt to answer includes:
(a). what is the impact of liquidity position in management?
(b). what is the relationship between liquidity and profitability?
(c). what are the criteria for determining adequate liquidity for a bank?
(d). how does liquidity influences a bank investment policy?
(e). what are the predicament of inadequate liquidity control management.
SIGNIFICANCE OF THE STUDY
The study justification arises given the unsavory experience of the
deregulated banking era in Nigeria and the present global economic
meltdown. Apart from this liquidity has always been a source of concern
with some Nigeria banks. The importance of liquidity has even acquired a
new dimension in the advanced countries of the world in recent years.
This is basically because of responses to structural changes and funds
management techniques in these countries. The development of new
technical innovations that do not necessarily fit into the world of the
age long liquidity tests.
The key role played in any banking set-up further epitomizes it
importance. Right from time liquidity has been associated with
allocation of assets. According to their capacity to generate the cash
necessary to satisfy creditors and depositor calls on the bank
liabilities.
However, with the emergence of active liability management strategies
liquidity has been more than a function, particularly in some instance
of the of the banks capacity to acquire additional funds in the market
place.
Limitation of the study
Time constraints were one of the limitations encountered in the case of the study.
This is because, this study was carried out during an academic session,
the researcher did not have enough time to properly concentrating on
this particular study.
Secondly, finance was yet another problem that put a check on the extent of investigation.
Finally there was the problem of inadequate information and unavailable material or information for the study.
SCOPE OF THE STUDY
Due to time and resources constraints the study at hand has been limited to First Bank of Nigeria Plc.
DEFINITION OF TERMS
The following definition terms are given to facilitate better understanding.
LIQUIDITY MANAGEMENT
This is the act of storing enough funds and razing funds quickly from
the market to satisfy depositors, Loan customers and other parties with a
view to maintain public confidence.
BANK
A bank is a financial house established for the purpose of accepting
deposits and lending out funds in addition to other services.
Central bank of Nigeria
This is the national apex and financial institution that regulates the
banking system value supply and cost of finds in the economy.
FINANCIAL SYSTEM
The aggregation of financial market arrangement institutions agent that
inter-act with each other and other economic unit together with the se
of rules and regulation that guide their interactions.
NIGERIAN DEPOSIT INSURANCE CORPORATION (NDIC)
This is the body which ensures that customer funds are insured in the
commercial banks at liquidation they make sure the customer are paid
bank their deposits.
PROFITABILITY RATIO
This a class of financial metrics that are used to asses a business
ability to generate earning and compared to it expenses and other
referent costs incurred during a specific period of time, for most of
these ratios, having a higher value relative to a competitors ratio or
the same ratio from a previous period is indicative that company is
doing well.
LIQUIDITY ASSTS THEORY
This theory argues that banks should hold large sum of liquid assets to avert sudden payment request that might be received.
CALL MONEY
They are banks excess reserves on daily or short-term basis with the correspondent banks.
SHORT-TERM GOVERNMENT SECURITIES
These are gifted securities with short-term maturity which are being bought and sold in active market.
MARGINAL LOANS
This is a loan made by a brokerage house to a client that allows the customer to buy stocks on credit
LIQUIDITY RATIO
This is a class of financial metrics that is used to determined a
company ability to pay off its short term debts obligation. Generally
the higher the value of the ratio, the larger the margin of safety that
the company posses to over short-term debts.
LIQUIDITY PORTFOLIO
Liquidity is the ability for the bank to have sufficient capital in it
account or cash deposited by individuals and portfolio is any collection
of financial assets such as stock bonds and cash it may be held by
individual investor and or managed by financial professionals hedge
financial institution, or a portfolio is a brief case for caring lose
papers.
You either get what you want or your money back. T&C Apply
![](https://codemint.net/assets/public/img/100-money-back-guarantee.png)
You can find more project topics easily, just search
-
SIMILAR BANKING FINANCE FINAL YEAR PROJECT RESEARCH TOPICS
-
1. CONTRIBUTION OF BANKING SECTOR TO AGRICULTURAL PRODUCTIVITY IN NIGERIA 1981-2013
» ABSTRACT Over the years issues related to sexuality and contraception have been taken with great reservation by Nigerians, as a result of increase in ...Continue Reading »Item Type & Format: Project Material - Ms Word | 52 pages |
Instant Download | Chapter 1-5 | BANKING FINANCE DEPARTMENT
-
2. IMPACT OF AUTOMATED TELLER MACHINE ON BANK CUSTOMER’S SATISFACTION IN UBA KADUNA MAIN BRANCH
» CHAPTER ONE INTRODUCTION 1.1 Background of the Study Automated Teller Machines (ATM) are devices used by bank customers to process account transaction...Continue Reading »Item Type & Format: Project Material - Ms Word | 90 pages |
Instant Download | Chapter 1-5 | BANKING FINANCE DEPARTMENT
-
3. THE IMPACT OF EXTERNAL RESERVES MANAGEMENT ON ECONOMIC DEVELOPMENT IN NIGERIA FROM 1985 TO 2014.
» ABSTRACT This is a research focused on “The impact of external reserves management on economic development in Nigeria from 1985 2014.’’ Based on...Continue Reading »Item Type & Format: Project Material - Ms Word | 90 pages |
Instant Download | Chapter 1-5 | BANKING FINANCE DEPARTMENT
-
4. THE ROLE OF FINANCIAL INSTITUTIONS IN EXPORT FINANCING IN NIGERIA FROM 2006-2012
» CHAPTER ONE INTRODUCTION 1.1 Background of the study Financial institutions are organizations which deal basically in money. `They constitute the fina...Continue Reading »Item Type & Format: Project Material - Ms Word | 61 pages |
Instant Download | Chapter 1-5 | BANKING FINANCE DEPARTMENT
-
5. THE IMPACT OF MONEY DEPOSIT BANKS ON THE ECONOMIC DEVELOPMENT OF NIGERIA
» ABSTRACT The title of the project work is “the impact of money deposit banks on the economic development if Nigeria. The aims and objectives of ...Continue Reading »Item Type & Format: Project Material - Ms Word | 52 pages |
Instant Download | Chapter 1-5 | BANKING FINANCE DEPARTMENT
-
6. THE IMPACT OF INTERNET BANKING SYSTEM ON NIGERIA BANKING ENVIRONMENT (A CASE STUDY OF UNION BANK OF NIGERIA)
» CHAPTER ONE 1.1 BACKGROUND OF STUDY In Nigeria, the banking industry witnessed lots of challenges due to increase in the awareness and utilization of ...Continue Reading »Item Type & Format: Project Material - Ms Word | 55 pages |
Instant Download | Chapter 1-5 | BANKING FINANCE DEPARTMENT
-
7. INTERNAL CONTROL SYSTEM AND BANK FRAUD PREVENTION IN NIGERIA BANKING INDUSTRY.
» INTERNAL CONTROL SYSTEM AND BANK FRAUD PREVENTION IN NIGERIA BANKING INDUSTRY (A CASE STUDY OF SELECTED BANKS IN AUCH Abstract This study mainly focus...Continue Reading »Item Type & Format: Project Material - Ms Word | 50 pages |
Instant Download | Chapter 1-5 | BANKING FINANCE DEPARTMENT
-
8. THE EFFECTS OF FINANCIAL LEVERAGE ON COMPANY PERFORMANCE (A CASE STUDY OF NIGERIA BOTTLING COMPANY)
» CHAPTER ONE INTRODUCTION 1.1 BACKGROUND OF THE STUDY Firms at every stage of growth and development, from concept to maturity need found in order to s...Continue Reading »Item Type & Format: Project Material - Ms Word | 52 pages |
Instant Download | Chapter 1-5 | BANKING FINANCE DEPARTMENT
-
9. IMPACT OF INTERNAL CONTROL SYSYTEM ON THE PROFITABILITY OF DEPOSIT MONEY BANKS IN NIGERIA
» CHAPTER ONE INTRODUCTION 1.1 Background of the study Banking is a financial intermediary service which is the link between two units of the economy, t...Continue Reading »Item Type & Format: Project Material - Ms Word | 52 pages |
Instant Download | Chapter 1-5 | BANKING FINANCE DEPARTMENT
-
10. THE EFFECT OF EXCHANGE RATE IN BALANCE OF PAYMENT OF NIGERIA ECONOMY
» CHAPTER ONE 1.0 INTRODUCTION 1.1 BACKGROUND OF THE STUDY In any nation, there arem basically four objectives or goal of micro economics policies. i. H...Continue Reading »Item Type & Format: Project Material - Ms Word | 52 pages |
Instant Download | Chapter 1-5 | BANKING FINANCE DEPARTMENT