International Journal of Accounting, Finance and Risk Management
Volume 5, Issue 3, September 2020, Pages: 157-166
Received: Jul. 22, 2020;
Accepted: Aug. 19, 2020;
Published: Aug. 27, 2020
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Akinwumi Olusegun Akinola, Department of Accounting, Achievers University, Owo, Nigeria
Omotayo Olubunmi Efuntade, Department of Economics and Demographic Studies, Federal University, Oye Ekiti, Nigeria
Alani Olusegun Efuntade, Office of the Vice Chancellor, Federal University, Oye Ekiti, Nigeria
This paper examined the effect of banks financing on industrial sector growth in Nigeria. The objectives of the Study were to examine the effects of domestic money supply, banks credit and maximum bank lending rate on industrial sector performance in Nigeria. The Study is established on Bank-based monetary framework on the grounds that the hypothesis focuses on the positive functions of banks in industrial growth and development. Descriptive and Ex-post facto research designs were adopted to investigate the contribution of various bank financing variables to industrial sector growth measured by manufacturing sector output in Nigeria over a period of 15 years (2004-2018). Method of analysis was the linear regression model using fully modified ordinary least square model to estimate the individual effects of banks financing variables measured by banks credits, domestic money supply, and maximum bank lending rate on industrial sector growth measured by manufacturing sector output. The study revealed that industrial sector growth is strongly impacted upon by banks credits, domestic money supply, and maximum bank lending rate. The study concluded that, there is positive significant relationship between bank credits, domestic money supply and growth in the industrial sector. Therefore, the study recommended that, banks should continue to support the industrial sector through credit borrowing, this way, the dwindling nature of Nigeria industrial sector can be redressed through adequate credits provided by these banks. However, these credits should be given at lower interest rate.
Akinwumi Olusegun Akinola,
Omotayo Olubunmi Efuntade,
Alani Olusegun Efuntade,
Banks Financing and Industrial Sector Performance in Nigeria, International Journal of Accounting, Finance and Risk Management.
Vol. 5, No. 3,
2020, pp. 157-166.
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