THE ROLE OF COMMERCIAL BANK IN INDUSTRIAL DEVELOPMENT OF NIGERIA (A CASE STUDY OF UNION BANK OF NIGERIA ONITSHA)
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Commercial Banks and industries synonymous as the growth of one is enhanced by the other. Precisely, Banking is an accent business. There were banks already in the accent Babylon during the Classical Civilization particularly in Rome. But modern banking started in Italy where bankers apart from buying and selling of foreign Currencies also took demand time deposits. This banking habit remained in Italy and other developed nations until in 1894 when British Bank of west African (BBWA) now called first Bank of Nigeria Plc was established in Lagos. Then in 1917, Barleys bankLtd. Now know as Union Bank Plc was established to challenge the monopoly of BBWA, Union Bank has the largest number of branches located all over the country Onitsha metropolitan is enjoying five healthy branches of \union Bank.
In the same vein the industry is as old as Man on earth. Eventhough the inception of industrial revolution which scattered industries to all nooks and corners of the World claimed to be the originator. Onitsha as the World industrial and commercial heart of the nation was not left out in this regard. With good communication and banking networks, a lot of industrialists potential ones are attracted from all work of life to locate their indutrice here in Onitsha, consequently, it will be understood in the subsequent chapters that the abundant assistance rendered to the industrialists by the commercial banks to a large extent helped in the development of Onitsha at large. Though both Bankers and Industrialist are a time faced with problems. And this thesis made honest attempts to expose some of the problems and recommend possible way of arresting those problems.
The ancient Commercial and Industrial City called Onitsha and her inhabitants were noted for their commerce, prior to the advent of the colonial master (Britain) grafting and farming were the major occupations of Onitsha. Onitsha since that period was rural area until late 40s when the glorious wind of Nigeria independence started to blow. Interested readers may like to know where Onitsha was originated. But for the purpose of this research work, the situation, does not occur for such. The present Onitsha which is made up of Onitsha North and South Local government Areas was carved out of old Onitsha division with headquarters at Onitsha the current Onitsha South Local Government area where the bank in question is located was with .its headquarters at Fegge in 1993. While Onitsha North local government area still maintains its original headquarter at Awka Road Onitsha. However, for the purpose of this thesis, the two autonomous local governments that made up Onitsha should be treated as a single entity Onitsha is situated about 60km South West of Awka the Capital City of Anambra State. A city with a population of over one million has about the biggest market in the West Africa known as Onitsha Main Market.
EVOLUTION AND DEVELOPMENT OFCOMMERCIAL BANKS IN NIGERIA.
In the first stage of this thesis, we did say that banking is an ancient business. Even before the outbreak of industrial revolution, there were banks in the ancient city of Babylon. But the system of their operations were very crude. At that time, the procedure was that the demand deposits were usually transferred ovally by the owner visiting the bankers, who sat behind his bench or table though cheques were not yet known. Thus the current term “bankruptcy” comes from the Italian custom of breaking the bench of the banker who could not pay off his creditors. The most famous of these grew at of the customer of Goldsmiths, who took gold and silver from customers for self-keeping. They later discovered that they could lend such coin out and a certain proportion as revenue since not all customers came in for reportion as revenue since not all customers came in for repayment at the same time. To make this transferable, Goldsmith issued the receipts in round number forms. Thus serving as primitive bank note, but repayable on demand by the bankers in gold or silver. Hence, we can say that goldsmith note becomes the precursor of modern bank note and goldsmith becomes the forerunner of modern banking.
Banking in Nigeria dates back to 1894 when the British bank lof West African (BBWA) was established by taking over corporation itself established two years earlier in 1892 since that time; the foreign banks dominated Nigeria banking scene until 1913 when the national bank of Nigeria enraged to becomes the first indigenous bank in Nigeria, however the origin of British bank of west Africa (BBWA) which later changed its name to standard bank of Nigeria Ltd. and currently to first bank of Nigeria, plc cannot be treated in an isolation of elder dempster. Elder demposter line which name as become synonymous with shipping and maritime trade in west Africa subregion was named after Alexander elder and john dempster.
In 1899, Anglo- African Bank was established at Calabar by the Royal Niger Company. The bank changed its name to Nigeria Ltd. But was later bought over in 1912 by BBWA. In 1917, Barleys bank Ltd. now knows as union bank Plc was established to change the monopoly of (BBWA) it was remarkable that between 1929 – 1952 many indigenous banks were established but most of them collapsed under misadministration.
BRIEF HISTORY OF UNION BANK OF NIGERIA PLC ONITSHA.The bank was incorporated as barleys bank of Nigeria limited on March 14th 1969 it was changed to union bank of Nigeria Ltd. Union bank Onitsha branch was established on March 1979 with about seven staff. Through dint of expand. Today the branch has a total of staff of about fifty-three with Mr. M.E. Ezeigbo as the branch manager. Moreso, the recent problem of distress facing some of our commercial banks especially our new generation banks, there is every tendency that the banks number of customer continue to increase infact, union banks stated no as a chance phenomenon rather for the basic social and economic needs of society. The needs especially as concern industrialists in no small measure will be seriouly looked into in the next stage of this thesis
1.2 STATEMENT OF THE PROBLEM
Commercial banking is in the service industry. The quality of service rendered by our banks have been attracting criticisms from people in all works of life. The government functionaries, industries, the media and the general public are all very critical of banking services. The complaints range from those of long delays in cashing cheques, tan. Diness in granting loan and or credits unfriendly attitude of banks workers. As early as 1943, Dr. Nnadi Azikwe said that I was frustrated because of the shoddy way and manner the manager of the Marine branch of the bank of British West African Limited treated me with rebuff. Not only did he keep me standing in this office for some minutes, he was curt and condescending as if I was seeking for favour. Naturally my pride was hurt and it downed on me that the struggle for Nigeria freedom had many fronts, and that political freedom was not enough, economic freedom must be won also, most banks do not put their customers in the prime place as they \are supposed to be.
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