Determinants of Bank Lending in Nigeria

OYEBOWALE, Adeola (2020). Determinants of Bank Lending in Nigeria. Global Journal of Emerging Market Economies.

[img]
Preview
PDF
0974910120961573.pdf - Published Version
Creative Commons Attribution.

Download (858kB) | Preview
Official URL: https://journals-sagepub-com/doi/full/10.1177/0974...
Open Access URL: https://journals.sagepub.com/doi/pdf/10.1177/09749... (Published version)
Link to published version:: https://doi.org/10.1177/0974910120961573
Related URLs:

    Abstract

    The willingness of commercial banks to provide loans is determined by various factors. In this regard, this paper provides empirical evidence on determinants of bank lending in Nigeria. The parsimonious model of this study investigates the impact of growth in loan-to-deposit ratio, growth in inflation, growth in broad money, and growth in bank capital on growth in bank lending using annual data from 1961 to 2016. This study adopts the autoregressive distributed lag (ARDL) bounds testing approach and Granger causality tests to investigate the relationship and direction of causality among the variables, respectively. The Granger causality tests show that growth in broad money Granger-causes growth in bank lending, while there is no causality from other explanatory variables to bank lending in Nigeria. Also, this study shows that growth in bank lending Granger-causes growth in loan-to-deposit ratio and growth in inflation in Nigeria. Thus, this paper argues that commercial banks in Nigeria exhibit stern concern for their liquidity and capital adequacy positions while acting as financial intermediaries. Additionally, this paper argues that the Central Bank of Nigeria (CBN) possesses “paper-based” independence.

    Item Type: Article
    Identification Number: https://doi.org/10.1177/0974910120961573
    SWORD Depositor: Symplectic Elements
    Depositing User: Symplectic Elements
    Date Deposited: 01 Nov 2019 12:19
    Last Modified: 16 Jun 2021 10:43
    URI: http://shura.shu.ac.uk/id/eprint/25375

    Actions (login required)

    View Item View Item

    Downloads

    Downloads per month over past year

    View more statistics