An Analysis of Commercial Banks

The objective of this study is to analyze the impact of the commercial banks credit on economic growth in Nigeria from 1992 to 2012. In order to examine the role of commercial bank credit to the economy, the commercial bank credit to the private sector of the economy is used to estimate its impact on Nigeria’s economic growth, which is proxy by gross domestic product. Using the ordinary least square it was found that the commercial bank credit has significant effect on the economic growth in Nigerian. As this is a good achievement, it requires more efforts to maintain and sustain it. Inline with that the following recommendation were made to that effect: better and stronger credit culture should be promoted and sustained; there should be strong and comprehensive legal framework that will continue to aid in monitoring the performance of credit to private sector and recovery debts owed to banks; bank should share among themselves information on bad debt; and preferred sectors like agriculture and manufacturing should be favoured in terms of granting loans.