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Impact of Bank Loan on the Manufacturing Sector of the Nigeria Economy (1990 – 2016) (PDF)

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– Impact of Bank Loan on the Manufacturing Sector of the Nigeria Economy (1990 – 2016) (PDF) –

Download Impact of Bank Loan on the Manufacturing Sector of the Nigeria Economy (1990 – 2016) (PDF). Banking and Finance students who are writing their projects can get this material to aid their research work.

Abstract

This study examines the effect of commercial bank credit on manufacturing sector output in Nigeria from 1990-2016 with the object of finding out the impact of bank loans on the manufacturing sector of the Nigerian economy within the period considered.

To identify the stationarity of the data employed in the empirical investigation, various econometric techniques like Augmented Dicky Fuller unit root test, Johansen cointegration test, and error correction mechanism were employed.

The result of the error correction model shows that the independent variables are all significant to impact on the manufacturing sector output in Nigeria.

The study concludes that commercial bank loan has a strong impact on the manufacturing sector in Nigeria for the year under the view.

Introduction

Lending is a vital function in banking operations because of its direct effect on economic growth and business development.

This is being pursued in most countries particularly the developing ones, where banks and their lending activities have been usefully integrated into government policy formulation in the national economic development process.

As far as banks are concerned, their role as lenders is as important as that of deposit-taking considering the interrelationship between deposit and lending (Nwosu 1999). Banking like any other business requires adequate capital to function effectively (Nwankwo 1990).

The economy of Nigeria is a middle income; mixed economy emerging market with well-developed financial legal, Communications, transport, and entertainment sectors.

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