1.1        Background of the study

1.2        Statement of problem

1.3        Objective of the study

1.4        Research Hypotheses

1.5        Significance of the study

1.6        Scope and limitation of the study

1.7       Definition of terms

1.8       Organization of the study




3.0        Research methodology

3.1    sources of data collection

3.3        Population of the study

3.4        Sampling and sampling distribution

3.5        Validation of research instrument

3.6        Method of data analysis



4.1 Introductions

4.2 Data analysis


5.1 Introduction

5.2 Summary

5.3 Conclusion

5.4 Recommendation



The Study investigated the role of financial institutions in a depressed economy. The objective is to find out whether the role of financial institutions is improving the growth and development of Nigeria economy, to know what the government doing to maintain or encourage the financial institutions in a depressed economy. We tested two hypothesis using chi-square methods. In hypothesis one, we tested the relationship between financial institutions and economic development. After calculated it was discovered that chi-square calculated is greater than chi-square tabulated. So the null hypothesis was rejected and all the alternative is accepted which said that, there is a relationship between financial institution and economic development. In hypothesis two, we tested the relationship between financial institutions and implementation of government policies. After calculated, it was discovered that chi-square calculated is greater than chi-square tabulated and the alternative is accepted which said that there is relationship between financial institution and implementation of government policies.



  • Background of the study

Having chosen this topic to write on, my objectives is to find out the roles played by our financial institutions in our present economic situation whether they being followed in this time of economic recession their effects on the economy and the extents to which they have gone in helping to revamp  the economy. The historical background or theses financial institution are made up of banking and non-banking institutions. The historical background of this financial institution is mode of operation which is an important aspect of this study. By their historical background We can now know the aims purpose, objectives of these financial institution in our economy. In 1st   July 1959, the first central bank of Nigeria (C.B.N) which was the apere bank that control other financial institution in the country was established. Commercial bank is the oldest of all banking institutional in Nigeria, it dates back to 1892 when. It was known as the bank of British West Africa (Now First bank of Nigeria) was established. This was followed in 1917 by the Barchys bank  (Dominidu, colonia and overseas) (DCO) (Now union bank in 1933. the first successful Indigenous commercial bank was named National bank of Nigeria was established in 1948. African continental bank (ACB) was established by 1960 at independent, these were (12) twelve banks operating in the country with a total number of 160 offices and branches scattered in different locations of the country. Many specialized credit instutitons have in the past two and half decades developed. These includes the Nigeria Merchant banks, Nigeria industrial development bank (NIDB) Nigeria bank for commerce and industry (NACB) established 1973 and restructured in the 1978 to include the finance of co-operative bank established in the federal mortgage bank of Nigeria constitution in July, 1977, merchant banks then are relatively new business which were trance to 1960 when Philip will Nigeria limited was established. The Non-bank financial institution includes finance companies, the oldest finance Ltd was established in 1959. Then insurance companies, then first insurance companies were 1921 and was named Royal exchange Assurance company, investment companies unit trust, co-operative societies which have its foundation from the establishment of co-operative stores in 1844 in Britain, its origin in Nigeria banks to the eighteen (18th) century Bureax De change which was establish in 1989 though the decree that the same your and person provident fund. It is the desire of all these financial institutions to to create an impact on the Nigeria economy. Also the citizen’s expectant from all these financial institution is to see the roles played by this financial institution in our present economic situations


In view of the depressed economy, there are bedeviled practices which disturb financial institutions in carrying out their roles for the growth of the economy. Those practices are as fellows below:

Lack of ability to supply funds (Loan) to the small scales industries (Business) The inability to offer interest yielding financial instruments. The inability to effectively manger the financial aspect of the economy.


The objectives of the study are;

  1. To find out whether the role is improving the growth and development of Nigeria economy is being played efficiently and effectively
  2. To ascertain those things that gives distress in the system
  3. To ascertain the relationship between financial institution and economy depression
  4. to know or X-ray what the government is doing to maintain any financial institution in a depressed economy like Nigeria

For the successful completion of the study, the following research hypotheses were formulated by the researcher;

H0:   There is no significant relationship between financial institutions and economic development.

H1: There is significant relationship between financial institutions and economic development

H02:  There is no significant relationship between financial institutions and implementation of government policies

H2:  There is significant relationship between financial institutions and implementation of government policies


The research project is more important to the financial institutions and department of the central bank of Nigeria, various commercial banks in Nigeria and it will also serve as readable material for further research. It is necessary for lectures (Teachers) and workers in relation to this study. It is important to student taking courses in accountant, banking and finance and economics to have modern approach to the teaching and understanding the financial institutions in which they will find interest in.


The research project is designed to cover the roles of financial institutions in the development of the economy. It shall cover both the present and past period of financial institutions in Nigeria. For easier collection of data some banks particularly commercial banks will be examined for the research. The researcher encounters some constrain which limited the scope of the study;

  1. a) AVAILABILITY OF RESEARCH MATERIAL: The research material available to the researcher is insufficient, thereby limiting the study
  2. b) TIME: The time frame allocated to the study does not enhance wider coverage as the researcher has to combine other academic activities and examinations with the study.
  3. c) Organizational privacy: Limited Access to the selected auditing firm makes it difficult to get all the necessary and required information concerning the activities


FINANCIAL INSTITUTION: A financial institution is an establishment that conducts financial transactions such as investments, loans and deposits. Almost everyone deals with financial institutions on a regular basis. Everything from depositing money to taking out loans and exchanging currencies must be done through financial institutions.

DEPRESSED ECONOMY: In economics, a depression is a sustained, long-term downturn in economic activity in one or moreeconomies. It is a more severe economic downturn than a recession, which is a slowdown in economicactivity over the course of a normal business cycle. Adepression is an unusual and extreme form of recession.


This research work is organized in five chapters, for easy understanding, as follows

Chapter one is concern with the introduction, which consist of the (overview, of the study), historical background, statement of problem, objectives of the study, research hypotheses, significance of the study, scope and limitation of the study, definition of terms and historical background of the study. Chapter two highlights the theoretical framework on which the study is based, thus the review of related literature. Chapter three deals on the research design and methodology adopted in the study. Chapter four concentrate on the data collection and analysis and presentation of finding.  Chapter five gives summary, conclusion, and recommendations made of the study

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