AN ASSESSMENT OF BANK RECAPITALIZATION AND ITS EFFECTS ON THE NIGERIAN ECONOMY: A CASE STUDY OF FIRST BANK OF NIGERIA PLC.

ABSTRACT The role of the banking industry as the catalyst and propellant of growth and development of any developing nation's economy cannot be over emphasized. However the banking industry in Nigeria has been unable to live up to its roles due to a number of factors notable; among which are unsound management practices and most especially capital inadequacy. The latter led to the collapse of most banks in Nigeria. The recapitalization policy initiated by the First Bank of Nigeria Plc was meant to address the above problems. The study also aims at assessing how the banking sector reforms have affected and repositioned the banking industry to meet the challenges of globalized financial market. Consequently, the review of the main characteristics of the various policies and the analysis of the impact of bank consolidation on the Nigerian economy was carried out using historical and descriptive method of research. A comparative analysis of selected banks (First Bank) using gross earnings profit after tax (PAT), loans, growth in deposits, assets value etc. revealed that there is significant growth and improvement in size and branch network, public confidence, funding of small and medium scale enterprises (SMS), wide ranging delivery services (i.e universal banking), distress prevention to mention few. The study has also shown growth and development have been fostered in the Nigerian economy, and consequent upon these, policy makers in the financial market and the government should provide the enabling environment through appropriate and multifaceted monetary regulatory and supervisory framework for the growth to be maintained and sustained for the betterment of the average Nigerians.