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The Study investigated the effect of bank regulation in the stability of the Nigeria bank system. The objective is to find out whether the effect of bank regulation is improving the growth and stability of Nigeria bank system, to know what the

government doing to maintain or encourage the bank regulation in the stability of the Nigeria Bank system. We tested two hypothesis using chi-square methods. In hypothesis one, we tested the relationship between bank regulation and stability Nigeria banking system development. After calculated it was discovered that chi-square calculated is greater than chi-square tabulated. So the null hypothesis was rejected and all the alternative is accepted which said that, there is a relationship between stability of Nigeria bank  and stability Nigeria banking system development. In hypothesis two, we tested the relationship between bank regulation and implementation of government policies. After calculated, it was discovered that chi-square calculated is greater than chi-square tabulated and the alternative is accepted which said that there is relationship between stability of Nigeria bank  and implementation of government policies.

                                             CHAPTER ONE


Even since the inception of the first three successful indigenous banks in Nigeria, the National Bank of Nigeria established on February 11th 1933, the Agbommagbe Bank (now wema Bank Nig Plc) in 1945, The African continental Bank Plc in 1947 and others subsequently established in the country  during the period from  1952 when the first banking ordinance was enacted to regulate  and control the activities of commercial banks in the country till present day, prand have remarried a permanent feature in our banking industry.

During the free banking era (between 1892 and 1952) there was no form of banking act or ordinance to regulate the stabilities shipment and operation of commercial bank. There are as it is presently supervised. Many bank were registered. Some of did not open their doors for  business ever for a day while some simply collected customers deposits and varnished. This had resulted to the deprivation of our economy an as a whole the much needs fund for development and  depriving individual the hard earned funds, this also brought about loss of faith trust on the commercial banks by Nigeria and the subsequent under developed banking habit in the country

However, with the introduction of the first banking ordinance in 1952 and the central bank of Nigeria (CBN) ordinance in 1958 to regulate and control the activities of commercial banking in the country fraud in commercial banks have rather increased in size, and method used by fraudster acquires greater  sophistication day by day. Presently with the introduction or modern banking procedures ie improved communication system, automatic electronic gadgets and computers networks into our banking system coupled with various precautionary measures taken by banks. To prevent fraud in the banks fraud have rather taken unclear dimension and the six and form involved increase in a geometric progression. Other Amptiam in his articles obstacle o growth of baking industry saw that it was discovered during investigation that bank now take extra precaution before clearing a cheque because of rampant incident of fraud and forgeries the form of fraud has placed banks loss on the average of # 1m per each working day of the year in Nigeria Asimi kola in his own article “The cash economy phenomenon” also observed that fraud has become sophisticated as to make forget cheque book good the owner to confirm it as his own signature recently in the bid curb the grand fraud, CBN issued a directive to bank to increase it capital base to # 25 billion. Previously section a of the decree 1990 state that, the minimum paid up capital for bank is #50 million for commercial bank. This directive come up after several bank has been discovered to have defrauded it is customers mostly foreign investors. In this required .

Bankers in a bid to reduce the size and rapid occurrence of fraud in their bank now take adequate precautionary measure before clearing cheques drawn their customers accounts. These precautionary measures bring into  focus another problem facing commercial banks,. The problem of time wastage in the banking hall. Ashimi Kola in his article also said that customer waits a minimum of about two hours in banking hall  of Nigeria banks to cash their money. This is one of the  most legitimate criticisms of the quality of  bank services. The checking process is long and by the time a cheque is released to cashier for payment, the customer is frustrated and perhaps Rast asleep among feering crowd. This calls for an overhaul of the checking and control system. E above being the general situation of things in commercial banking fraud is there fore number one enemy to all concerned with growth and development of banks., the intention of this research work therefore aimed at identification of the fraud on Nigerian economy in general and on Afribank Nigeria plc Enugu in particular  and recommend more functional measure that will help in the prevention and to reduction of fraud in commercial bank in Nigeria.


            The historical background of these stability of Nigeria bank  is mode of operation which is an important aspect of this study. By their historical background. We can now know the aims purpose, objectives of these stability of Nigeria bank  in our bank system. In 1st   July 1959, the first central bank of Nigeria (C.B.N) which was the ampere bank that control other stability of Nigeria bank  in the country was established. Bank regulation is the oldest of all banking institutional in Nigeria, it dates back to 1892 when. It was known as the bank of British West Africa (Now First bank of Nigeria) was established. This was followed in 1917 by the Barchys bank  (Dominidu, colonia and overseas) (DCO) (Now union bank in 1933. the first successful Indigenous bank regulationwas named National bank of Nigeria was established in 1948. African continental bank (ACB) was established by 1960 at independent, these were (12) twelve banks operating in the country with a total number of 160 offices and branches scattered in different locations of the country.

Many specialized credit instutitons have in the past two and half decades developed. These includes the Nigeria Merchant banks, Nigeria industrial stability bank (NIDB) Nigeria bank for commerce and industry (NACB) established 1973 and restructured in the 1978 to include the finance of co-operative bank established in the federal mortgage bank of Nigeria constitution in July, 1977, merchant banks then are relatively new business which were trance to 1960 when Selected bank regulationin Nigeria was established. The Non-bankstability of nigeria bank  includes finance companies, the oldest finance Ltd was established in 1959.

Then insurance companies, then first insurance companies were 1921 and was named Royal exchange Assurance company, investment companies unit trust, co-operative societies which have its from the establishment of co-operative stores in 1844 in Britain, its origin in foundation Nigeria banks to the eighteen (18th) century Bureax De change which was establish in 1989 though the decree that the same your and persen provident fund.

            It is the desire of all these bank regulationto to create an impact on the Nigeria bank system. Also the citizen’s expectant from all thesestability of nigeria bank   is to see the effects played by thesestability of nigeria bank  in our present  stability nigeria banking system situations.


In view of the stabilityof the Nigeria Bank system, there are bedeviled practices which disturbs bank regulationin carrying out their effects for the growth of the bank system. Those practices are as fellows below:

(1)                                      Lack of ability to supply funds (Loan) to the small scales industries (Business)

(2)                                      The inability to offer interest yielding financial instruments.

(3)                                      The inability to effectively manger the financial aspect of the bank system.


The objective of this research work are tacitly states as follows

I.                        To determine the contribution of bank regulation toward a positive  stability Nigeria banking system growth and wealth creation.

II.                        To examine ways in which the bank regulation in Nigeria can be made to play better effects towards fund mobilization for  stability nigeria banking system growth and development.

III.                        To  analysis the construction and short coming facing bank regulation toward fund mobilization for  stability Nigeria banking system growth .

IV.                        To determine and test the effect of some relevant  stability nigeria banking system variable and factors on the real gross domestic product (GDP) of Nigeria .

1.4            RESEARCH QUESTION

(i)                                         Doesstability of nigeria bank  (Banks) engage themselves in activities that help to develop the bank system?

(ii)                                       Does the banks regulation have any effect on the effects of stability of Nigeria bank  as they play in the bank system?

(iii)                                     Does long-term borrowing affect the effect ofstability of nigeria bank  in the  Nigeria Bank system?

(iv)                                     Is the contribution of financial funds to banks enough to be felt at well as stimulating the bank system?


For the purpose of this study, the hypothesis shall be analyzed in order to prove their level of rejections and acceptance. These are hypothesis which were used.

Ho: There is no significant relationship between deposit money bank and  stability Nigeria banking system development.

Hi: There is significant relationship between deposit money bank and  stability Nigeria banking system development.


The research project is more important to the bank regulationand department of the central bank of Nigeria,  various deposit banks in Nigeria and it will also serve as readable material for further research.

It is necessary for lectures (Teachers) and workers in relation to this study. It is important to student taking courses in accountant, banking and finance and economics to have modern approach to the teaching and understanding the bank regulationin which they will find interest in.

1.7            SCOPE OF THE STUDY

The research project is designed to cover the effects of bank regulationin the stabilityof the bank system. It shall cover both the present and past period of bank regulationin Nigeria. For easier collection of data some banks particularly deposit banks will be examined for the research.


I wish to express my difficulties which I encountered when collecting information through the questionnaires

The present fuel price increase was a major limited as it made transportation to these banks and libraries quite difficult.

Besides times and financial constraints, some other factors that militated against this research projects includes:

1.         Lack of books:         The scope of its work was electively affected because of scarcity of books in the relevant areas.

2.         Attitude constraints:         In the case of the questionnaire, some blatantly refused to collect it to gill while those that collected tool a lot of time to fill the required answers. Some fill them haphazardly.

3          Bureautic constraints:                  Under this limitation concrete attempt made to interview or reach top official failed because of redtaptism in running official engagements and procedures in releasing the official or secret of the company.

1.9            DEFINITION OF TERMS:

i.          Financial Institution:        it may be defined as unit or sectors which mobilized sailing and allocate them into investment projects for this study, I shall take them as those institutions which gather together financial resources from surpluses sector to pump into the deficit sectors for  stability nigeria banking system development.

ii.         Modus operand: This means the mode of operation in the financial institution.

iii.                 Financial intermediation: these are bank regulationwhich match the deposit requirement of savers with the investment requirements of the borrowers.

iv.                 Savings: it constitutes that part of income not spent on consumption or expenditure on goods or services. But for in purpose of this project, saving will be taken as that part of total income not spent on immediate consumption but is set towards accentuation of capital for further transactions.

v.                   Non-Banks: In this project, non banks on bank regulationincludes insurance companies, investment companies unit trust, co-operative societies, Bureax De change, primary mortgage institutions and pension and provident fund all these are non-banks, bank regulation  which help in  stability Nigeria banking system growth of the stability of the Nigeria Bank system.