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Bank Savings and Bank Credits in Nigeria: Determinants and Impact on Economic Growth

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  • Orji Anthony

    (Department of Economics, University of Nigeria, Nsukka, Nigeria.)

Abstract

This study investigated the determinants of bank savings in Nigeria as well as examined the impact of bank savings and bank credits on Nigeria's economic growth from 1970- 2006. We adopted two impact models; Distributed Lag-Error Correction Model (DL-ECM) and Distributed Model. The empirical results showed a positive influence of values of GDP per capita (PCY), Financial Deepening (FSD), Interest Rate Spread (IRS) and negative influence of Real Interest Rate (RIR) and Inflation Rate (INFR) on the size of private domestic savings. Also a positive relationship exists between the lagged values of total private savings, private sector credit, public sector credit, interest rate spread, exchange rates and economic growth. We therefore recommend, among others, that government's effort should be geared towards improving per capita income by reducing the unemployment rate in the country in a bid to accelerate growth through enhanced savings.

Suggested Citation

  • Orji Anthony, 2012. "Bank Savings and Bank Credits in Nigeria: Determinants and Impact on Economic Growth," International Journal of Economics and Financial Issues, Econjournals, vol. 2(3), pages 357-372.
    • Handle: RePEc:eco:journ1:2012-03-13
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    References listed on IDEAS

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    1. B. Gerard Dages & Linda S. Goldberg & Daniel Kinney, 2000. "Foreign and domestic bank participation in emerging markets: lessons from Mexico and Argentina," Economic Policy Review, Federal Reserve Bank of New York, issue Sep, pages 17-36.
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    Citations

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    Cited by:

    1. FERROUHI, El Mehdi & LEHADIRI, Abderrassoul, 2014. "Savings Determinants of Moroccan banks: A cointegration modeling approach," MPRA Paper 76371, University Library of Munich, Germany.
    2. Nesru Kasim Banke & Mekonnen Kumlachew Yitayaw, 2022. "Deposit mobilization and its determinants: evidence from commercial banks in Ethiopia," Future Business Journal, Springer, vol. 8(1), pages 1-10, December.
    3. Mushtaq, Saba & Siddiqui, Danish Ahmed, 2016. "Effect of interest rate on bank deposits: evidences from Islamic and non-Islamic economies," MPRA Paper 69245, University Library of Munich, Germany.
    4. Prof. Nnamocha, P. N. & Anyanwu, Austin C. (PhD), 2022. "Domestic Investment and Economic Growth in Nigeria, 1980-2020," International Journal of Research and Scientific Innovation, International Journal of Research and Scientific Innovation (IJRSI), vol. 9(8), pages 122-131, August.
    5. ORJI Anthony & OGBUABOR Jonathan E. & CHIAMAKA F. Okolomike & ANTHONY-ORJI Onyinye, 2022. "Capital Inflows, Financial Development And Growth In Ecowas Countries: A New Empirical Insight," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 22(1), pages 61-80.
    6. Anthony Orji & Jonathan E. Ogbuabor & Chiamaka F. Okolomike & Onyinye I. Anthony-Orji, 2022. "Do Capital Inflows and Financial Development, Influence Economic Growth in West Africa? Further Evidence from Transmission Mechanisms," Econometric Research in Finance, SGH Warsaw School of Economics, Collegium of Economic Analysis, vol. 7(1), pages 71-94.
    7. La Saidi & Pasrun Adam & Rostin & Zainuddin Saenong & Muh. Yani Balaka & Gamsir & Asmuddin & Salwiah, 2017. "The Effect of Stock Prices and Exchange Rates on Economic Growth in Indonesia," International Journal of Economics and Financial Issues, Econjournals, vol. 7(3), pages 527-533.
    8. repec:eco:journ1:2014-03-23 is not listed on IDEAS
    9. Anthony Orji & Christian E. Ugwu & Jonathan E. Ogbuabor & Onyinye I. Anthony-Orji & Lynda C. Nwufo, 2022. "Cash Reserve Ratio and Credit to Micro-, Small and Medium-Sized Enterprises in Developing Economies. Analysis of Transmission Channels Using Nigerian Data," Finansovyj žhurnal — Financial Journal, Financial Research Institute, Moscow 125375, Russia, issue 1, pages 71-88, February.
    10. Marina Malkina, 2019. "Determinants of Private Savings in the Form of Bank Deposits: A Case Study on Regions of the Russian Federation," Economies, MDPI, vol. 7(2), pages 1-22, June.
    11. Mushtaq, Saba & Mushtaq, Faiza, 2022. "Effects of inflation (consumer price index) and other macroeconomic variables on bank deposits: Evidence from Pakistan," MPRA Paper 113093, University Library of Munich, Germany.

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    More about this item

    Keywords

    Bank; Saving; Credit; Financial Sector; Economic Growth;
    All these keywords.

    JEL classification:

    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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