ROLE OF COMMERCIAL BANKS IN INDUSTRIAL DEVELOPMENT
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ROLE OF COMMERCIAL BANKS IN INDUSTRIAL DEVELOPMENT
Chapter one
Introduction
1.1 Background of the Study
Commercial banks and industrial banks are synonymous, with one benefiting from the other’s expansion. Banking is a business that existed in Babylon and Rome during classical civilization. However, modern banking began in Italy, where bankers, in addition to buying and selling foreign currency, accepted demand time deposits.
As a result, these banking habits persisted in Italy and other developing countries until 1894, when the British Bank of West Africa (BBWA), now known as First Bank of Nigeria Plc, was created in Lagos by a shipping manager from Liverpool named Alfred Jones.
Then, in 1917, Barleys Bank Ltd, now known as Union Bank Plc, was created to challenge the BBWA’s monopoly. Union Bank now has the most branches nationwide.
Similarly, industry has been around as long as man. Even the inception of the industrial revolution, which dispersed industries throughout the world, claimed to be the originator.
With good communication and financial networks, a large number of potential industrialists from all walks of life are drawn to their industries in this country.
As a result, the next chapters will demonstrate that the commercial bank’s generous assistance to industrialists contributes significantly to Nigeria’s overall development. Both bankers and businessmen experience issues from time to time. And this research endeavour made honest attempts to expose some of the flaws and offer potential solutions.
Evolution and Development of Commercial Banks in Nigeria
In the first stage of this, we stated that banking is an ancient enterprise. Even before the start of the industrial revolution, banks existed in the ancient city of Babylon, but their activities were extremely primitive.
At the time, the procedure was for the owner to visit the banker who sat baking his bench or table using cheques that were unknown. Thus, the contemporary term “bankruptcy” derives from a banker who was unable to pay off his debtors.
The most well-known of them grew at the expense of goldsmiths who collected gold and silver from customers for safekeeping. They eventually learned that they could lend such coin out and earn a specific percentage as revenue because not all clients came in for payment at the same time.
To make this transportable, goldsmith gave receipts in round number format. As a result, it serves as a primitive bank note that is repayable in gold or silver upon demand by bankers.
As a result, we might argue that goldsmiths’ notes were the precursors of current banknotes, and goldsmiths became the forerunners of contemporary banking.
Banking in Nigeria dates back to 1894, when the British or West African (BBWA) was established by taking over the corporation itself, which had been established two years earlier in 1892. Since then, foreign banks have dominated the Nigerian banking scene until 1913, when the National Bank of Nigeria became the first indigenous bank in Nigeria.
However, the origins of the British Bank of West Africa (BBWA), which later changed its name to Standard Bank of Nigeria Ltd and is now known as First Bank of Nigeria Plc, cannot be viewed as an Elder Dampster isolation.
Elder Dampster Line, which has become synonymous with shipping and marine trade in the West African subregion, was named after Alexander Elder and John Dampster.
The Royer Niger Company created the Anglo African Bank in 1899 in Cross River State, Calabar. The bank eventually changed its name to Nigeria Bank Ltd, but was later acquired by BBWA in 1912.
Then, in 1917, Barleys Bank Ltd, now known as Union Bank Plc, was created to challenge the BBWA’s monopoly. It was amazing that numerous indigenous banks were created between 1929 and 1952, but the vast majority of them failed due to poor management.
Union bank was founded as Barleys Banks of Nigeria Limited on March 13, 1969, and was later renamed Union Bank of Nigeria Limited.
Furthermore, given the recent hardship experienced by several of our commercial banks, particularly our new generation banks, there is every reason to believe that the growth, as mentioned by Union Bank, is due to the basic social and economic demands of society. The needs, particularly those of industrialists, will be carefully considered in the next step of this research.
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