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Challenges of Bank Consolidation to the Central Bank of Nigeria: A Descriptive Analysis

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  • Ahmad Bello, Dogarawa

Abstract

Consolidation is one of the trends that characterize banking industry restructuring in Nigeria. However, the emerging scale of bank mergers raises challenging policy questions that must be addressed by policy makers in the course of promoting economic efficiency while safeguarding the nation’s financial system. This paper analyses the challenges of the banking consolidation to the Central Bank of Nigeria (CBN). The paper is descriptive and uses literature survey method. Data was collected from secondary source through CBN publications, local and international journals and other published materials. The paper argues that the recent consolidation poses new challenges to the regulatory authority, particularly in the area of financial system stability. It therefore, recommends that CBN’s policies aimed at providing financial system stability and efficiency should take into consideration the process of banking consolidation and increasing globalisation of financial transactions.

Suggested Citation

  • Ahmad Bello, Dogarawa, 2006. "Challenges of Bank Consolidation to the Central Bank of Nigeria: A Descriptive Analysis," MPRA Paper 23198, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:23198
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    References listed on IDEAS

    as
    1. Tetsuji Okazaki & Michiru Sawada, 2004. "Effects of bank consolidation promotion policy: Evaluating the Bank Law in 1927 Japan," Discussion papers 04004, Research Institute of Economy, Trade and Industry (RIETI).
    2. Jalal D. Akhavein & Allen N. Berger & David B. Humphrey, "undated". "The Effects of Megamergers on Efficiency and Prices: Evidence from a Bank Profit Function," Finance and Economics Discussion Series 1997-09, Board of Governors of the Federal Reserve System (U.S.), revised 10 Dec 2019.
    3. Simon H. Kwan, 2004. "Banking consolidation," FRBSF Economic Letter, Federal Reserve Bank of San Francisco, issue jun18.
    4. Stephen A. Rhoades, 2000. "Bank mergers and banking structure in the United States, 1980-98," Staff Studies 174, Board of Governors of the Federal Reserve System (U.S.).
    5. Elizabeth Laderman, 2003. "Good news on Twelfth District banking market concentration," FRBSF Economic Letter, Federal Reserve Bank of San Francisco, issue oct24.
    6. International Monetary Fund, 2004. "Bank Consolidation and Performance: The Argentine Experience," IMF Working Papers 2004/149, International Monetary Fund.
    7. Jennifer P. Poole & Kevin J. Stiroh, 2000. "Explaining the rising concentration of banking assets in the 1990s," Current Issues in Economics and Finance, Federal Reserve Bank of New York, vol. 6(Aug).
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Bank Consolidation;

    JEL classification:

    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation

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