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CHAPTER ONE

INTRODUCTION

1.1   STATEMENT TO PROBLEM

In a developing economy such as Niger there is need for various financial intermediaries that will engage in financing of this various sectors of this economic.  Those sectors include agricultural sector industrial sector housing sector commercial sectors etc.  Banks are one of these financial intermediaries in Niger that engages in deposit acceptance and financing of specific legal; projects. In  Nigeria, their exist  three types of banks  namely merchant bank commercial bank and development banks three has always been this problem of distinguishing the role of thee banks in the development of the country   in most  cases people sees these various bank to  have and play the same impact on an economy. It is based on this assumption and be believe that the researcher wants to study the separate impact and role of development bank in lacking the federal mortgage bank as a case study.  The researcher will like to live estimate in what ways the federal mortgage bank has helped in the development of the economy and also the problems encounters by the developments in Nigeria.

1.2   RATIONALE OF THE STUDY

The rational of the study is to extend the level of banking system in assisting the existing financial institution.  The purpose of establishing development banking in Nigeria was as a result of inadequacies of the existing financial institution to needed for the development of the industrial and agricultural sectors. The system has contributed immensely towards the agricultural and development sectors of the economy and to help in the Nigeria financial system. This came to existence and perfection of its objective in allocation of funds to ensure a allocation of health economy and a sound financial system.  It has helped a lot in developing the Nigeria banking system?

1.3    SIGNIFICANCE OF THE STUDY

The Nigerian development banking system is very important and of a paramount interest to Nigeria.  Its   banking services are precisely indispensable of which leads to a continuance in the economic growth of the nation.

Its contributions are follows.

A  Through a development banking the country can achieve a sophisticated financial system

B  This banking makes granting  of loans to  be realistic both long and short term credit in their various terms.

c.  To assist in the allocation of financial for various sector of the economy.

d. It help to work out experiments for making out incentive and regulator  which would effectively induce private institutions to allocate  finance to particular  sectors deserving priority.

1.4     DEFINITION OF TERMS

BANKS: This refers to in this context   as all  development banks which exist within the   banking industry Nigeria. 

BANKING: This is defined as the practice of accepting deposit and giving loans including monetary and advisory service.

DEVELOPMENT: This is refereed to as a progress or sophistication in any activity whether in the administration banking organization and other areas where activities are involved which many encounter development.  Development in banking means increase in   the level of knowledge of activities due to the advent of civilization industrialization technology etc.

IMPACT: This is a help or contribution in causing a situation even or condition to encounter a work in progress.  Also it is an effort to develop knowledge in any aspect of development.  Impact is an encroachment into a system activity condition or situation in order to incur a well structured and standardized knowledge of any thing in progress.

DEVELOPMENT BANK: This is defined as a financial institution that is  set up to help the merchant   banks in areas where they are not meeting up in the creation of short and long term  credit for economic development .

DEVELOPMENT BANKING: This is a structure created by the government to help in the allocation of  fund or financial to various sector of the economy.  It as also established to work out incentive and regulations which would effectively induce private institutions to carry her obligations deserving priority.

DEVELOPMENT BANKS:  Some of the development banks treated here as follows:

1. FEDERAL MORTGAGE BANK OF NIGERIA:

This was established to grant long term credit facilities to other mortgage institution.  Also it was put into existence to encourage mortgage institution in the country.  Furthermore it aims at providing loans at a rate determined by the government.

2. NIGERIA AGRICULTURAL  AND CO-OPERATIVE AND RURAL DEVELOPMENT BANK (NACROB)

This was established as a result of merging of three development banks who are not working effectively forwards the achievement of its goal.  It is concerned taking of deposit. It also provides loans to individuals and cooperative societies for all classes of agriculture projects trading   small scale craftsmanship and other enterprises.

3. THE NIGERIAN BANK FOR COMMERCE AND INDUSTRY: This bank was established for rapid implementation of the Nigerian enterprise promotion.  It also aims at transferring fund to the industrial area projects and all concurring commerce and merchandise.

4. NIGERIAN INDUSTRIAL DEVELOPMENT BANK (NIDB): This is a bank established to help in the facilitation of industrial development projects.   It grants loans for projects pertaining to industrial development. It also gives advice for potential foreign exchange investors. Fostering the development of capital markets it equally creates alternative opportunities for productive investments in Nigeria.

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