THE FACT OF COMPETITIVE BANKING STRATEGIES AND CHANGES IN NIGERIA

INTRODUCTION

1.1       BACKGROUND OF THE STUDY

The Nigerian economy can be termed to be a seller’smarket because the problem in Nigeria is producing not selling because anything can be sold, so therefore the need for marketing of bank’s services. The need for marketing is necessary because of competition, mop up the excess liquidity in the economy and to attract customers so as to sell loans to them and buy deposits from them. As the economy develops and expands around the world, Nigeria is not excluded because thereare fresh opportunities as well as threats that will give no chance for any arm chair banker or any banker who is not sound in marketing orientation. But on the other hand, it will favor the advanced banker who is dynamic in his skills, frequently evaluating the internal and external environment, assessing his competitors, evaluating the threats and opportunities to his business and identifyingnew customers in the sector.Looking at a brief history of marketing in Nigerian banking, the origin shows how economic, political and social environment have influenced the marketing of financial services in Nigeria. Although conventional banking began in Nigeria in 1891 with the establishment of the African Banking Corporation which later became Bank Of British West Africa, little has been done in marketing because the banks were established mainly to serve the foreigners (that is the British) commercial interests that existed then in the Nigerian colony; so they were not interested in developing new banks or clients. In 1899, Bank of Nigeria another foreign bank was established but was absorbed in 1912 by the Bank of British West Africa. In 1925, Barclays Bank got into the Nigerian banking system as a result of the merging of the Colonial Bank, the Anglo-Egyptian Bank and the National Bank of South Africa. These banks started operations in localities where the British commercial interests were dominant and did not bother to satisfy the needs of the indigenous Africans because of their foreign commercial interests. This was possible due to the fact that there were no regulations regarding the marketing of banking services then and coupled with the fact that the foreign  banks were also not helpful to the Africans. This culminated in the the establishment of indigenous banks to serve the Africans specifically Nigeria. Unfortunately, due to a lot of unrealistic objectives, fraudulent practices,

1.2     THE PURPOSE OF THE STUDY

The relevance of banks in the economy of any nation cannot be over emphasized. They are the cornerstones, the linchpin of the economy of a country. The financial deregulation in Nigeria started in 1987 and the associated financial innovation have generated an unprecedented degree of competition in the banking industry. The deregulation initially pivoted powerful incentives for the expansion of both size and number of banking and non-banking institutions. Competitive Strategies. The consequent phenomenal increase in the number of banking and non-banking institutions provide financial services which led to increased in competition amongst various banking institution and banking and non-banking financial intermediaries.

1.3       STATEMENT OF RESEARCH PROBLEM

This Research Work Is An Attempt To Answer The Following Research Questions

1. Can we determine the strategies that affect competition in the banking industry?
2. Can we determine how environment affects competition in the banking industry?

1.4       SIGNIFICANCE OF THE STDUY

This study is significant because of the following reasons:

1. It will generate information in the new millennium on environment, customer service, financial and marketing strategies that will make banks in Nigeria to cope well with the competition.
2. It will provide information on the various strategies of competition as it would be useful to economic policy makers. Banks manager and financial institution.

1.5       RESEARCH HYPOTHESES

Spiegel (1992) observed that in an attempt to reach decisions, it is useful to make assumption or guesses about the populations involved. Such assumptions which may or may not be true are called statistical hypothesis and in general are statements about the probability distribution of the populations. In this research work four hypotheses will be tested that the proportion of the respondents who agreed that:

 There are financial strategies that affect the competition of the banks.

 There is freedom of entry and exit of firms in the banking industry.

REFERENCES

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