(Caprio, and Klingebiel, 1996). Nigeria is a country blessed with abundant reserves of natural resources that could support the long-term growth plans of the country. Thus the banking sector holds a considerable promise in the development plans of the Nigeria into the future. This aspect was hardly been through to the focus due to various factors like unstable governance systems, soaring debts during the 1990 period. In an effort to transform the Nigerian banking sector several creative efforts and effective interventions were made in the past. The present efforts are part of the fourth phase of reforms implemented in Nigeria sine 2004. During this period it is expected that intervention of Nigerian monetary authorities could eliminate structural and operational weakness prevailing in the system besides creating avenues for private sector participation for enhancing the overall growth (.Balogun, 2007): Inspite of the best efforts taken to implement the reforms it is debated that these reforms have hardly resulted in the expected results. Thus a detailed research is undertaken to asses the present performance of the banks functioning in Nigeria and the impact of banking in the overall growth process in the country. The results from the research would give a detailed picture on the performance of the banks, the growth strategy adopted, public confidence in the banking operations.
2. Literature Review:
The detailed studies have been undertaken to explore the reasons behind the failure of banking sector in the developing and transition economies. The results from these studies have clearly highlighted the warning signs and indicators relevant to this situation in details. And, these information could be effectively used for creating appropriate policies that result in better stability of banking operations in these nations (Honohan, 1997) The most remarkable step was the one initiated by the Central bank of Nigeria (CBN) which introduced the 13 point agenda. The most important among them was the requirement of the bank to have a minimum capital of 170 million USD. This have resulted in the serious consolidation measures which culminated in the final number of 24 banks with clear mandate of future course of action (Asaolu, n.d.) The clear indications are the tremendous rise in the asset growth observed across the 2006 - 2007 period. The growth jumped by atleast 50 % from the initials of 10 to 20 %. (Asaolu, n.d) Recovery of the bad debts, positioning the banks on a growth path and energizing them for undertaking effective business operations are the major objectives before the chief executives in the new era of the Nigerian banking. The Central Bank of Nigeria have also heavily supported five most sick banks in the effort to revitalize the sector. Clear message have been conveyed across the debtors like issuing their names in the newpapers or in public places etc. The changes in the management of different banks have also been carried out without creating any chaos in the operations.
Creation of large banks