ABSTRACT
Deposit mobilization and profitability are the twins of management which make the subject matter of this research work to cut across virtually all management functions and their application in the banking industry. The research paper also highlighted the benefit of efficient marketing activities on deposit mobilization in the banking industry. The research paper analyzed in details the problems that are facing our banking sectors and not care or worry attitudes of our banking executive towards the effective’s use of the problem. However, deposit mobilization involves the various ways through which fund can be mobilized from the publics. In essence, marketing activities on profitability is the activities of identifying current market situation, analyzing current market opportunity threat and issues set objectives, devices a marketing strategy, set of implementation policy, the operating budgeted statement in achieving set tasks and finally a technique for its successful operation. The research works also examine how practicable the marketing activities on deposit mobilization and profitability in our banking sectors carried out a detailed research. And the Banking sectors needs this instrument of marketing activities in analyzing their immediate environment so as to give some experience of a particular problem of any pertinent development in the environment.
CHAPTER ONE
1.0 INTRODUCTION
1.1 BACKGROUND OF THE STUDY
With the current level of competition in the banking industry, the area which make the banking comfortable is definitely over the threat posed by the announcement of a new capitalization requirements of #25 billion for all banks by the Central Bank of Nigeria in July, (2004) introduced a fundamental challenge the altered the operating dynamics of the banking industry. As part of the wider agenda by the monetary authorities to engender the consolidation of the banking industry. This project work is intended to examine the impact of marketing activities on Deposit Mobilization and Profitability in Nigeria Banks.
Marketing itself is defined as the performance of business activities that direct the flow of goods and services from producer to consumer or user. This definition was given by the “American Marketing Association”. According to Steven Hillested and Eric (1995) both defined marketing as the “process of understanding customers” wants and needs and designing appropriate programmes and services to meet those wants and needs in a timely, cost effective competitive fashion.
The financial repressions theory developed by Kinnon and Shaw (1973) indicated that low interest rate lead to capital flight theory reducing the availability of lend able funds for investment and growth in the domestic economy. On the other hand, an increase of real interest rate will increase the cash inflow and deposit base of bank for investment and growth in the domestic economy.
Furthermore, the removal of controls on interest rate and credit ceiling can be expected to greatly enhance the efficiency of financial intimidation by channeling credit to high yielding investment opportunities. It is also expected “That by restructuring the banking sector and training banking officials and staff, having their own, marketing and also a competent bank marketing manager, capacity of the banking sector will be improved with the increase banking services available to the public.
It is argued that competition will not be possible if the banking sector is dominated by government owned banking institution and that risk of inefficiency is associated with direct credit controls with pre-reform government intervention.
The marketing approach providing any type of product or services is to identify the need of a particular customer and offer a particular product or services that will satisfy the need. The provider of the product or services should be able to make a profit while satisfying a customer need at the same time.
Finally, the opening of financial markets to foreign competition will provide an incentive for banking institution to adopt efficient means of delivering banking services. A close look at the banking industry will show that some of the banks have fully responded to the development within their business environment. They should not remain static to the old philosophy in a dynamic environment but cherishing a system of looking beyond present period and not leaving every thing to change.
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