Select Currency
Translate this page

LIQUIDITY MANAGEMENT PRACTICE AT FIRST BANK OF NIGERIA

Format: MS WORD  |  Chapter: 1-5  |  Pages: 65  |  1248 Users found this project useful  |  Price NGN5,000

  DOWNLOAD THE FULL PROJECT

CHAPTER ONE

INTRODUCTION:

BACKGROUND OF THE STUDY

A bank is considered liquid when it has asset and investment in security that are easily reliable at a short notice without a loose to the bank together with the ability to raise fund from he other source, to enable it to meet its payment obligation and financial commitment in a timely manner. In addition there should be financial commitment buffer to meet almost all financial emergency.

Liquidity management of a commercial bank is a very vital issue in the banking industry. It is the ability of the bank to manage its liquidity position so that neither the liquidity nor the profitable will suffer. For this to be effective, liquidity management must contribute to the achievement of the overall cooperate fund management objectives to attain and maintain a balance of profitability, solvency and liquidity.

Obligation of the maximum liquidity owed by surplus unite can only be archived by holding enviable fund as cash since it has maximum profitability. The must invest all fund on loan and average the highest yielding, and most liquid of the entire asset in the bank. Banks, because of the important role they play in the economy, particularly in monetary and credit aspect of the economy faces a lot of restriction irrespective of the fact that banks are the most highly and closely regulated of all the business, they still have to operate within the confines of the law and solve the problem of liquidity and profitability dilemma in the economy. Apart form the constraints and the dual role of liquidity and profitability, there is virtually no work on the liquidity management in Nigeria commercial banks. In the light of this, the researcher has decided to discuses this topic based on the analysis of the data collected. The researcher will suggest some solution the problem of liquidity management in the country.

STATEMENT OF THE PROBLEMS

Commercial bank asset management is a never-ending thing of war. This war is pitched between efficient liquidity management on one hand and profitability on the other hand. As Liquidity and profitability are two inherent goals in commercial bank, bank managers will continue to experience the conflict o trying provide efficient mechanism of addressing their bank liquid and hence their safety of necessarily arising from the nature of their liabilities.

A high proportion of commercial bank liabilities are made up of demand deposits (current account fund deposits) saving deposit, fixed deposit and fund from other source. Demand deposit are those bank liabilities that are payable on demand. Necessary commercial bank need to keep only liquid asset to meet a considerably volume of withdrawal. Liquid asset earn little of zero return on asset. It is les risky and the less it likely to yield adequate returns. As such, the high the less risky asset, the more banks is expose to experience a bank run or crisis. At that rate will probably not able to recover all its cost and then also make profit for the owners. But behold. Commercial bank are business oriented firm with their share holder interested on profitability. In other to satisfy its share holders, a bank might be attempted to forget liquidity and pursue profitability by investing on a high yielding less liquid asset that are profitable at the expense of liquidity which is dangerous. It is always necessary to balance liquidity and profitability in order to have efficient bank management.

The ratio or the percentage of idle cash balance in the commercial bank are to hold at any point in time and to what form to hold it is very necessary. While doing that, they should bear in mind the importance of satisfactory level of profit. There are many constraints to bank in achievement of their goal liquidity and profitability such as legal reserve requirement and they should maintain adequate liquidity to meet the unforeseen and seasonal loan demand and fluctuations of deposits. Cash reserves are also needed to take the advantage of unexpected profitability investment opportunities. In effect, banks are constrained and have to walk on a tight rope. There is the never ending of war or what I may refer to as dilemma policy commercial bank management in developing country. The Nigerian case is further aggravated by the inconsistency of the monetary policy as administered by the central bank of Nigeria. Is the reticent of the monetary coups detach. You will just walk up one morning and hear over the radio of via circular No XY2 that the central bank of Nigeria has issued a monetary circular No adjusting the private whether upward or downward.

The federal government directive on withdrawal on all federal parasttatals account from the commercial bank is one of such constraint. The stock stirred up aggressive market in the banking industry. Although all this stock are necessary to produce the desired control of money in the economy, but such tends to give nightmare to the banking management. This directive causes ripples in the banking industry as such cause more discrepancy in the liquidity position of the commercial bank and subsequently the rate of profitability.

OBJECTIVE OF THE STUDY

The objectives of the study are;

1.To look at the liquidity management of the bank in Nigeria with more emphasis on their investment liquidity and profitability portion.

2.To found out why bank need to be more liquidity than any other business organization

3.To solve the liquidity – profitability problems of the banks. To look at the effectiveness and management of the portfolio, by employing and using various approach, theories and instrument in solving their liquidity profitability problems.

4.To examine the bank investment outlet (e.g. loan and advance investment in treasury bills. Banker unite fund, bankers certificate called money, equity participation in small and medium scale firms etc) and the degree of liquidity of such establishment shall be examined.

5.To take critical look of the asset portfolio management of banks with a view to determine if there is a relationship between the rate of profitability and liquidity.

6.To identify why Nigeria banks are excessively liquid and at the same time make high profit.

SIGNIFICANCE OF THE STUDY

The importance of liquidity management in the banking industry cannot be over – emphasized. Since not more contribution was made in the topic liquidity management, the researcher will carefully examine those relevant to efficient liquidity management for a successful achievement of the desired profitability. It is hoped that the result obtained form the study will benefit the management and the non-bank financial institution, business enterprise and student of financial accounting, banking and finance student and other related course. Readers of this study/work will be expose as regarding the input of future study. The basis of this research work is the position of liquidity of the Nigerian commercial bank as determinant of profitability.

DEFINITION OF TERM

Portfolio: this is a list of security and investment loan stock, shares and lands held/owned by a bank, individual or and organization

Portfolio management: this goes with the management of the security holding (investment portfolio of a bank or a business firm). A committee or portfolio management department or any other body might manage a portfolio.

Liquidity: it is the ability of bank to pay cash immediately when called upon to do so for all of its demand liability.

Liquidity management: it is the ability of the bank to manage the liquidity position so that neither the liquidity nor the profitability will suffer. It evolves the provision for the withdrawal of deposit, short term, and cash cyclical and satirical cash requirements.

Bank deposit: these are fund deposited in a bank. It is divided into demand saving and time deposits

Demand deposit: this also known as checking the account deposit payable on demand that is without pro notice of withdrawal.

Saving deposit: this type of deposit is usually evidence by a past book under which the depositor customer of the bank is required to notify the bank before withdrawal, but it is not the same in practice.

Asset: these are the entire property of a bank and other investment in other profitable organization.

Asset management: it is the allocation of fund, the basic objective being the maximization of profitability, solvency and regulatory constraints.

Bank run: A run occurs in a bank where there is mismanagement of liquidity and profitability.

  DOWNLOAD THE FULL PROJECT

LIQUIDITY MANAGEMENT PRACTICE AT FIRST BANK OF NIGERIA

Not The Topic You Are Looking For?



For Quick Help Chat with Us Now!

+234 813 292 6373

+233 55 397 8005


HOW TO GET THE COMPLETE PROJECT ON LIQUIDITY MANAGEMENT PRACTICE AT FIRST BANK OF NIGERIA INSTANTLY

  • Click on the Download Button above.
  • Select any option to get the complete project immediately.
  • Chat with Our Instant Help Desk on +234 813 292 6373 for further assistance.
  • All projects on our website are well researched by professionals with high level of professionalism.

Here's what our amazing customers are saying

Emmanuel Essential
Kogi state University
I actually took the risk,you know first time stuff But i was suprised i received as requested. I love you guys 🌟 🌟 🌟 🌟
Very Good
Abdulrazak Bello Marsha
Usman Dan fodio University
It was quite a better guide for project and paper presentation purpoting. Many thanks.
Average
Adam Alhassan Yakubu
UDS
Excellent work and delivery , I promise to share my testimonies everyone in need of this kind of work. You're the best
Excellent
MATTHEW NGBEDE
Ahmadu Bello University
I wish I knew you guys when I wrote my first degree project, it took so much time and effort then. Now, with just a click of a button, I got my complete project in less than 15 minutes. You guys are too amazing!
Excellent
Dau Mohammed Kabiru
Kaduna State College of Education Gidan Waya
This is my first time..Your service is superb. But because I was pressed for time, I became jittery when I did not receive feedbackd. I will do more business with you and I will recommend you to my friends. Thank you.
Very Good
Oluchi From Michael Opara University
If you are a student and you have not used iprojectmaster materials, you are missing big time! iprojectmaster is the BEST
Excellent
Ibrahim Muhammad Muhammad
Usmanu danfodiyo university, sokoto
It's a site that give researcher student's to gain access work,easier,affordable and understandable. I appreciate the iproject master teams for making my project work fast and available .I will surely,recommend this site to my friends.thanks a lot..!
Excellent
Joseph M. Yohanna
Thanks a lot, am really grateful and will surely tell my friends about your website.
Excellent
JONNAH EHIS
Ajayi Crowther University, Oyo
I was scared at first when I saw your website but I decided to risk my last 3k and surprisingly I got my complete project in my email box instantly. This is so nice!!!
Excellent
Gbadamosi Solomon Oluwabunmi
Lasu
Swift delivery within 9 minutes of payment. Thank you project master
Excellent

FREQUENTLY ASKED QUESTIONS

How do I get this complete project on LIQUIDITY MANAGEMENT PRACTICE AT FIRST BANK OF NIGERIA?

Simply click on the Download button above and follow the procedure stated.

I have a fresh topic that is not on your website. How do I go about it?

How fast can I get this complete project on LIQUIDITY MANAGEMENT PRACTICE AT FIRST BANK OF NIGERIA?

Within 15 minutes if you want this exact project topic without adjustment

Is it a complete research project or just materials?

It is a Complete Research Project i.e Chapters 1-5, Abstract, Table of Contents, Full References, Questionnaires / Secondary Data

What if I want to change the case study for LIQUIDITY MANAGEMENT PRACTICE AT FIRST BANK OF NIGERIA, What do i do?

Chat with Our Instant Help Desk Now: +234 813 292 6373 and you will be responded to immediately

How will I get my complete project?

Your Complete Project Material will be sent to your Email Address in Ms Word document format

Can I get my Complete Project through WhatsApp?

Yes! We can send your Complete Research Project to your WhatsApp Number

What if my Project Supervisor made some changes to a topic i picked from your website?

Call Our Instant Help Desk Now: +234 813 292 6373 and you will be responded to immediately

Do you assist students with Assignment and Project Proposal?

Yes! Call Our Instant Help Desk Now: +234 813 292 6373 and you will be responded to immediately

What if i do not have any project topic idea at all?

Smiles! We've Got You Covered. Chat with us on WhatsApp Now to Get Instant Help: +234 813 292 6373

How can i trust this site?

We are well aware of fraudulent activities that have been happening on the internet. It is regrettable, but hopefully declining. However, we wish to reinstate to our esteemed clients that we are genuine and duly registered with the Corporate Affairs Commission as "PRIMEDGE TECHNOLOGY". This site runs on Secure Sockets Layer (SSL), therefore all transactions on this site are HIGHLY secure and safe!