Capitalisation, Mergers and the Nigerian Economy: A Historical Review

Abstract

The policy of mergers and acquisitions was made to enable banks of like minds to pool both human and material resources for expansion and profit maximisation. In this way, the policy states, the banks will be repositioned to finance capital projects in the country as well as face the challenges of the 21st century cross-national economic integration. So far, this policy has reduced the number of fragile and marginal banks in Nigeria from 89 to 25. This paper, seeks to give a historical insight into the story of mergers, capitalisation and the Nigerian economy, beginning from the earliest British economic adventures in the country in the 19th century up to the present time. It also examines the impact of the recent bank re-capitalisation exercise in the country and the challenges that may likely face the industry in the near future.