Liqiudity Management Practice At First Bank Of Nigeria Plc

A bank is considered liquid when it has asset and investment in security that are easily reliable at a short notice without a loose to the bank together with the ability to raise fund from he other source, to enable it to meet its payment obligation and financial commitment in a timely manner. In addition there should be financial commitment buffer to meet almost all financial emergency.

Liquidity management of a commercial bank is a very vital issue in the banking industry. It is the ability of the bank to manage its liquidity position so that neither the liquidity nor the profitable will suffer. For this to be effective, liquidity management must contribute to the achievement of the overall cooperate fund management objectives to attain and maintain a balance of profitability, solvency and liquidity.

Obligation of the maximum liquidity owed by surplus unite can only be archived by holding enviable fund as cash since it has maximum profitability. The must invest all fund on loan and average the highest yielding, and most liquid of the entire asset in the bank.

Banks, because of the important role they play in the economy, particularly in monetary and credit aspect of the economy faces a lot of restriction irrespective of the fact that banks are the most highly and closely regulated of all the business, they still have to operate within the confines of the law and solve the problem of liquidity and profitability dilemma in the economy. Apart form the constraints and the dual role of liquidity and profitability, there is virtually no work on the liquidity management in Nigeria commercial banks. In the light of this, the researcher has decided to discuses this topic based on the analysis of the data collected. The researcher will suggest some solution the problem of liquidity management in the country.

Register/Login to Access Full Work

CITE THIS WORK

• APA
• MLA
• MLA 7
• Chicago