Effect of Global Financial Meltdown on the Nigerian Banking Industry and Economy

Abstract

The paper ascertained the effect of the global financial meltdown on the Nigerian banking Industry and Economy. The study explores the plausibility of the assumption of the research topic stated above, using the Nigerian banking sector and economy as a focal point. The intensity of the financial crunch in Nigeria was one that went through all facets of the Nigeria economy. The research work adopted ordinary least square method of econometric techniques to evaluate whether or not their existed a negative, positive or neutral relationship among variables of interest. The study covered a period of 42 quarters and employed secondary data. Specifically, it holds that the global financial meltdown had a negative or reverse effect both on the Nigerian banking sector and the economy. However, some quarters following the financial meltdown, there were drastic changes (negative) in the variables that explain the financial development of the economy. Hence, the research concluded by suggesting economic policies that could restore the economy to full stability as well as adequately insulate the economy against future financial crisis. The study recommends that policy makers should evolve comprehensive measures to address the crisis at the national level and in any case to bring about a return to stability in the international financial system