ABSTRACT This research work focuses on the Effect of Information Communication Technology (ICT) on deposit mobilization and profitability of banks in Nigeria. It also revealed how computer technology is being used in taking strategic decisions in an organization, with the usage of computer technology. It helps to discover how efficiently and effectively the bank(s) are performing as regards deposit mobilization and trend(s) in profitability. Some research instrument(s) were used in this continuous writing were: Interview, Questionnaire and Observations which were illustrated with charts and (Chi-square). It starts with background of the study up to final recommendation to the higher



Capital occupies a vital position in any business in which bank is included capital is particularly important in the banking industry, that is adequacy is a comfort to the depositor or the shareholder. Bank are to be adequately capitalized in order to perform their role in building the nation economy.

According to the editorial of Nigeria bankers (2003) “The nature of Nigeria banking industry was healthy and sound from the independent in 1960 to their deregulation and the liberalization of the industry which started kin and middle of 1980’s, situation changes drastically since manifestation of bank distress that subsequently cleared the life of 37 banks from 1994 to 2003 in which their problems can be traced bank to the undercapitalization of these banks.

The National Economic Empowerment and Development (NEEDs) 2004, is the initiative of the Obasanjo’s administration aimed at reforming the entire economy of the nation Nigeria. Under the NEEDs    the financial service in clear with the country are to reformed, given clear with the country are to be reformed, given that “the success of NEEDS will depend in part on the ability of the financial intermediaries to play their roles by adopting the strategy of addressing low capitalization, the poor governance practice of financial  intermediaries that submit inaccurate reformation to regulatory authorities and to strengthen and rationalize the regulatory and supervisory framework in the financial sector.

The reform agenda under NEEDs is saying categorically that the low capitalization of banks must be death with achieving the goals of NEEDs.

According to Sanusi (2005) “The new capital accord, base II of 1998 tackle the issue of capital at the inception, the major element of based committee of the 1998 capital accord included the explicit unmake of capital requirement to a bank question and degree of risk and establishment of internationally, comparable minimum capital requirements. Combining the objectives if National Economic Empowerment and Development Strategy (NEEDs) and that of the new capital accord based II of 1998 it will be deduced that up with the global economic and financial trend and ensigncy the economic development of Nigeria.

Ogunniyi (2005) is of the opinion that the Central Bank of Nigeria as empowered by BOFIA from time to time determine the minimum paid up share capital of categories of bank in Nigeria in which there were upward review from time to time. The issue of recapitalization to banks to the time of #25 billion was announced by CBN governor Charies Soludo on the 6th July, 2004 generated a lot of controversies but if practically examine, it is what the nation need for overall economic growth.


According to (Ogunniyi 2005) prior to the announcement of CBN governor professor Charles Soludo raise their capital base to #25 billion by December 2005 there has been many distress stories of banks in Nigeria. 

There are banks in the sector that are goes candidates of merger and acquisition outright liquidation virtually all the bank kin this group have either overdrawn their account with CBN or have had their capital eroded by losses. It is observed that many banks merging as a means of survival at the expense of real banking operation, it is evidence that the low capitalization of the bank has make it difficult to finance the economy. Any bank with a strong capital base will serve as a shock absorber.

 Low capital of banks is the causes of many stories of bank distress in the country which usually have a bad effect on the economy of a nation in term of competition, under capitalized ban will not able to compete with the other banks in the global market.


The Nigeria banking system has undergone remarkable changes over the years, in terms of the number of institution ownership structure as well as depth and breath of operation. These changes have been influenced largely by challenges passed by deregulation of the financial sector.

Globalization of operations, technological innovations and adoption of supervisory and prudential requirement that conform with international standard. As at the end of 2007, there were 89 deposited money banks operation in the country, comprising institution of various size and degree of soundness. Hence, the largest banks in Nigeria has a capital base of about 240 million compares of #528 million for the smallest bank in Malaysia.

The latest assessment shows that the whole overall health of Nigeria banking system could be described as generally satisfactory, the state of some bank was leas cheering specifically, as at end of March 2004, the CBN’s rating of all the banks, classified 62 as some satisfactory. 14 as marginal and are manifested by their over drawn position with the CBN, high incidence of non-performing loans, capital deficiency, weak management and poor corporate governance. These shortcoming have, in recent years led to the revocation of the licensed of two clearing house activities prior to the commencement of the new settlement system.


The main hypothesis used in this project topic are Null hypothesis Ho

Alternative hypothesis Hi

Ho:      There is no impact of recapitalization on shareholder return in the banking industry.

Hi:       There is impact of recapitalization on shareholder return in the banking industry.

Ho:      There is no impact of recapitalization on credit fined by the bank

Hi:       There is impact of recapitalization on credit fined by the bank.


In the wake of bank failures, the economy suffered several stress. Many depositors and the shareholders lost their hand earned money, many suffered starvation because their breakdowns lost their jobs in the process. In a number of cases, depositors who lost their life savings died because of their apparent hopelessness. People from different angles of life have commenced on this commonly topical issue as it touches the very fabric of the national economic life.

This study is being embarked upon with a view to justifying the ongoing recapitalization exercise as directed by the CBN and how it would affect the Nigeria economy.             

The research work will be of benefits to practicing bankers, students of business studies seeking to study the Nigeria banking industry and the entire public who need to have knowledge of the recapitalization and consolidation of Nigeria banking industry.


The purpose of this research work is to investigate the role of capital for financial institution, why is it important, how market generated capital requirement from regulatory requirement and from that regulation requirement should be taken. Bank serve as a useful focus for analysis because many of the friction that make capital structure relevant cost of financial distress, asymmetric information, transaction cost and regulation have been studied in banking literature.

Moreover, banks play an important role on global economy, and are the first category of institution to be subjected to internationally coordinated capital regulation.

Finally bank systematically have the highest leverage of firms in any industry, in sharp contrast on the implications. In the light of painful experience distress in the Nigeria banking industry and that of the current aggressive competition in the industry due to upsurge in the system, this research work aims to investigate.

  1. What measure should be adopted avoiding another experience of distress in the system?                     
  2. What deficiency should be removed to ensure that banks study healthy and operate efficiency?
  3. What impact would the recapitalization exercise have on the Nigeria economy?
  4. How should the issue of merge among banks be resolved without on unforeseen failure?


In carrying out this research work, attention would be focused on commercial banks recapitalization issues, recapitalization policy of the central bank of Nigeria and its impact of Nigeria and its impact of Nigeria banking industry.

This research work will be limited to the volume of information acquired through materials like national dailies, periodic journals, text books, speeches, internet and writer-ups on related subject.


Time Constraint: During the course of writing this research work, the respondent that justify the question took a lot of time before making an effect on the questionnaire paper. The time for the research works is so short to go on extra mile for more data.

Inadequate Data: This research work will be limited to the volume of information acquired through materials like national dailies, periodic journals, text books, speeches, internet material and writer-ups on related subject.      

Lack of adequate finance: During the course of writing this research, there is lack of finance to travel from one place to another place for the collection of more data for the research work.

Incorporate attitude of respondents: As it is unduly know that banks are often busy, so questionnaire administration were not answered very well because majority of the staffs were occupied with the customers. This constraint might be regard as that of non-response during peak periods.


Bank:  According to Sir John Paget, a bank is a corporation or person(s) who accepts money on accounts, pay cheques on such account and collects cheques for customers. F.E Perry, also described bank as an establishment,. Which deals in money, receiving it on deposits on demand, collecting cheques from others and lending or investing the surplus until required.

Capital: It means the value of business (Get worth) to the owners, and it may have been built up by direct investment by the owners by the retention of post profit or both. Capital (c) = Asset (A) – Liabilities (L).

Recapitalization: This refers to the change in capital in the financial institution in order to make an effect on their operation.

Effect: Is an impact of something on a particular operation.   

Shareholder: Is an individual who contribute to the development and operation of an organization as a means of receiving dividend.

Liquidity: Is the ability of banks to maintain sufficient cash balance or such assets that can be easily and instantly converted into cash, to meet cash withdrawal requirement of its customers, and to meet other cash operation at all times.

It is also the ability of banks to grant loans or advance as a function of the extent of the liquidity of the bank.


This research work would be divided into five chapter. The first chapter will be introduction and overview of the study. Chapter two will focus on the interactive review on recapitalization of the being industry. The third chapter would be based on the methodology to be used for data analysis and chapter four will focus on the interpretations and analysis of the data collected while the final chapter which is chapter five shall comprise the summary of findings, conclusion and recommendations.    


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How To Write Chapter Three Of Your Research Project (Research Methodology)

  • Methodology In Research Paper

    Chapter three of the research project or the research methodology is another significant part of the research project writing. In developing the chapter three of the research project, you state the purpose of research, research method you wish to adopt, the instruments to be used, where you will collect your data, types of data collection, and how you collected it.

    This chapter explains the different methods to be used in the research project. Here you mention the procedures and strategies you will employ in the study such as research design, study design in research, research area (area of the study), the population of the study, etc. You also tell the reader your research design methods, why you chose a particular method, method of analysis, how you planned to analyze your data.

    Your methodology should be written in a simple language such that other researchers can follow the method and arrive at the same conclusion or findings.

    You can choose a survey design when you want to survey a particular location or behavior by administering instruments such as structured questionnaires, interviews, or experimental; if you intend manipulating some variables.

    The purpose of chapter three (research methodology) is to give an experienced investigator enough information to replicate the study. Some supervisors do not understand this and require students to write what is in effect, a textbook.

    A research design is used to structure the research and to show how all of the major parts of the research project, including the sample, measures, and methods of assignment, work together to address the central research questions in the study. The chapter three should begin with a paragraph reiterating the purpose of research. It is very important that before choosing design methods try and ask yourself the following questions: Will I generate enough information that will help me to solve the research problem by adopting this method?

    Method vs Methodology

    I think the most appropriate in methods versus methodology is to think in terms of their inter-connectedness and relationship between both. You should not beging thinking so much about research methods without thinking of developing a research methodology.

    Metodologia or methodology is the consideration of your research objectives and the most effective method and approach to meet those objectives. That is to say that methodology in research paper is the first step in planning a research project work.

    Design Methodology: Methodological Approach

    Example of methodology in research paper, you are attempting to identify the influence of personality on a road accident, you may wish to look at different personality types, you may also look at accident records from the FRSC, you may also wish to look at the personality of drivers that are accident victims, once you adopt this method, you are already doing a survey, and that becomes your metodologia or methodology.

    Your methodology should aim to provide you with the information to allow you to come to some conclusions about the personalities that are susceptible to a road accident or those personality types that are likely to have a road accident.

    The following subjects may or may not be in the order required by a particular institution of higher education, but all of the subjects constitute a defensible in metodologia or methodology chapter.

    Click here to complete this article - How To Write Chapter Three Of Your Research Project (Research Methodology)


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