Monday, 1 July 2013
MARKET-INDUCED CONSOLIDATION
11:17
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MARKET-INDUCED
CONSOLIDATION IN POST CONSOLIDATION BANKING ERA
Abstract
The regulated consolidation in the Nigerian banking system is being
examined to identify the shape of restructuring that is emerging within the
sector. The global trend in consolidation led to the Nigerian banking system reform
in 2005 of which recapitalization through mergers and acquisition was a readily
effective option. The data used was through personal interview using industry survey
evidence and experiences of industry practitioners. The analysis is basically
qualitative descriptive analysis. The banking
reform came with opportunities and challenges for the banks and the regulators.
Most outstanding challenge has been information technology transformation, some
of the consolidated banks have suddenly found a need for further consolidation
which has opened up the a market induced consolidation opportunities to shore
up their capitalisation, branch network and synergise in their operations . The
regulatory authorities should facilitate further consolidation of the banks to
a manageable number with extensive network of branches without regulatory
coercion as it were in earlier consolidation with its attendant cost to
depositors, banking sector confidence and stability.
Suleiman .A.S. Aruwa
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