table of contents
title page
Approval page
Dedication
Acknowledgement
Table of contents
Abstract
Chapter one
1.0 Introduction
1.1 Background of the study
1.2 Statement of the problem
1.3 Objectives of study
1.4 Research question
1.5 Significance of the study
1.6 Scope of the study
1.7 Definitions of terms
chapter two
2.0 Review of related literature
2.1 Brief introduction
2.2 Model and theories relevant to the research questions
2.3 Current literatures based on the variables of the research question
2.4 Summary of literature review
chapter three
3.0 Research methodology
3.1 Research design
3.2 Area of the study
3.3 Population of study
3.4 Sampling techniques
3.5 Sources of data
3.6 Instrument for data collection
3.7 Validity and reliability of instruments
3.8 Distribution and retrieval of the instrument
3.9 Method of data analysis
chapter four
4.0 Data presentation and analysis
4.1 Data presentation and interpretation according to research question
4.2 Findings
4.3 Discussion on the findings
chapter five
5.0 Summary, Conclusion and recommendations
5.1 Summary of findings
5.2 Conclusions
5.3 Recommendations
5.4 Limitation of the study
5.5 Limitation of the study
5.6 Suggestions for further research
references
appendix a
appendix b
abstract
The topic of this project is Treasury management strategies for effective bank performance and profitability. The objectives, to assess the impact of treasury management strategies on performance of banks in carrying out their activities, to investigate the impact of treasury management strategies on the problem of liquidity, to access the impact of treasury management in weak capital base of Nigerian banks, to examine the operation of Nigerian banks along with their counter parts on other civilized countries in other to meet up with the global trends.
The researcher also used primary and secondary data which is the questionnaires, interview, and textbooks.
From the analysis of the data presented, it is absolute clear and safe to treasury management strategies has a great effect on the performance and profitability of most banks in Nigeria, using five banks as the case study which includes, First Bank of Nigeria, Fidelity bank plc, Eco bank plc, Access bank plc and Union bank plc, all located at Owerri. Also, it was concluded that working capital policy, minimal debt financing and adequate managerial decisions has posed a great effect on the banks profitability.
in the light of the above findings, the following recommendations are made which will help regulate and effectively enhance performance, managers should equip themselves with the adequate financial management skills.
CHAPTER ONE
1.0 INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The banking scene in Nigeria has undergone a transformation in the past decade, with the rapid globalization and opening up of markets; on both front of wholesale and retail banking given the expanded business opportunities across the globe and the increasing starriness
And expectations of the corporate and the enhanced purchasing power of the middle class Nigerian.
Given the economic background and the filed attracting many new players; jostling for an increased presence has led to rapid expansion and a plethora of products to won the customer while walking the tight rope between compliance, regulation and fast changing consumer demands.
against this backdrop, there is a fair share of myths, beliefs and biases surrounding the town questions of what drives performance in banking and how to drives performance in banking?
many financial institutions spend how much laime focusing on “how” without the overarching agies of the “what”.
treasury management (or treasury operations) includes management of an enterprises holdings with the ultimate goal of maximizing the firm’s liquidity and mitigating its operational, financial and reputational risk.
Treasury management includes a firm’s collections, disbursements, concentration, investment and funding activities. in large firms, it may also include trading in bonds, currencies, financial derivatives and the associated financial risk management.
Most banks have whole departments devoted to treasury management and supporting the client’s needs in this area. Until recently, large banks had the stronghold on the provision of treasury management products and services. however smaller banks are increasingly launching and / or expanding their treasury management functions and offerings, because of the market opportunity afforded by the recent economic environment (with banks of all sizes focusing on the clients they serve best). availability of (recently displaced) highly seasoned treasury management. professionals, access the industry standard, third-party technology provider’s products and services tired according to the needs of smaller clients, and investment in education and other best practices. a number of independent. Treasury management systems (TMS) are now available world wide such as Hedge book pro, Derivative pricing and Hedge book Audit, allowing enterprises to conduct treasury management internally.
For non-banking entities the terms treasury management and cash management are sometimes used interchangeably, while, infact, the scope of treasury management is larger (and includes funding and investment activities mentioned above). In general, a company’s treasury operations comes under the control of the CEO, Vice president/director of finance or treasurer, and is handled on a day to day basis by the organisation’s treasury staff, controller, or comptroller. bank treasurer may have the following departments;
1.2 STATEMENT OF THE PROBLEMS
In Nigeria today, there has been lot of controversy as to whether a bank should maintain a high ratio of liquidity, increase its loan ratio or not. many writers argued that banks should maintain a high liquidity so as to meet the customers demands on day to day transaction.
for this research the statement of the problem includes;
* The poor performance of banks in carrying out their activities.
* The problem of liquidity & profitability in banks.
* The weak capital base of Nigeria banks
* The need to align Nigeria banking industry with the global trends
1.3 OBJECTIVES OF THE STUDY
The purpose of these research study is to access the effect of treasury management. Strategies on banks profitability and performance that. Shows the needs to align Nigeria banking industries with the global trends; such as
- To assess the impact of treasury management strategies on poor performance of banks in carrying out their activities.
- To investigate the impact of treasury management strategies on the problem of liquidity and profitability in banks
- To access the impact of treasury management in weak capital base of Nigeria banks, there has increase the working capital for better performance.
- To examine the operation of Nigerian banks along with their counter parts on other civilized countries in other to meet up with the global trends.
1.4 RESEARCH QUESTIONS
In an effort to accomplishing this research work effectively and perfectively, the researcher presents the following.
- What are the strategies employed to access the impact of treasury management strategies on poor performance of banks in carrying out their activities?
- Does investigating the impact of treasury management strategies on the problem of liquidity and profitability on banks enhance better performance?
- Does working capital have an effect on the bank’s liquidity or better performance?
- Does examining the operations of Nigerian banks alongside their counter parts in other civilized countries align them the global trend?
1.5 SIGNIFICANCE OF THE STUDY
The significance of this study shows the benefit to these people, banks and the nation in these following ways.
- In all aspect this research work will be beneficial to the manager’s and employees in Nigeria
- Also it will be of importance to government
- It will also be beneficial to other public sector organisation in Nigeria
- Finally, academically this research study will be of benefit to potential and future researchers on the issue of treasury management strategies for effective bank performance and profitability.
1.6 SCOPE OF THE STUDY
Particularly this research work focuses on treasury management strategies, for effective bank performance and profitability using five banks in Owerri as the center of interest.
The five banks that will benefit from this research are as follows.
- Access bank
- First bank
- Eco bank
- Fidelity bank
- Union bank, all located at Owerri
1.7 DEFINITION OF TERMS
PROFITABILITY: The state or condition of yielding a financial profit or gain. it is often measured by price to earnings ratio.
CASH MANAGEMENT: Theories and methods for management of liquid means (Orgler 1970 in Larsson & Hammerlund, 2005:12).
WORKING CAPITAL BALANCE: Expresses the balance between current assets and current liabilities (Pass & Pike, 1984).
BOND: A bond is an instrument of indebtedness of the bond issuer to the holders. it is the debt security under which the issuer owes the holders a debt and depending on the terms of the bond, is obliged to pay them interest (the coupon) and or to repay the principal at a later date, termed the maturity date (i) interest is usually payable at fixed intervals. (Semiannual, annual, sometimes monthly). Very often, the bond is negotiable, i.e the ownership of the instrument can be transferred in the secondary market. This means that once the transfer agents at the bank medallion stamp the bond, it is highly liquid on the secondary market.
STRATEGIES: A method or plan chosen to bring about a desired future, such as achievement of a goal or solution to a problem.
HEART OF THEIR JOB: As it is used in the research work means their main job.
FINANCIAL PERFORMANCE: The financial performance of a company usually relates to how well a company can use its assets to generate revenue (www.investopedia.com).
LIQUIDITY: The liquidity of an asset means how quickly it can be transformed into cash. when referring to company liquidity, one usually means its ability to meet its current liabilities and is usually measured by different financial ratio (www.investowards.com).
RECESSION: A recession is said to occur when there is a decline in GDP for two following quarters. (www.businessdictionary.com).
FINANCIAL CRISIS: A financial crises occur when the demand for money is higher than the supply causing a shortage of liquidity on the market. (www.bsinessdictionary.com).
PROFITABILITY RATIOS: The profitability of a company can be described as its ability to generate income which surpasses its liabilities.
Profitability ratios such as price to earning ratio, ROE and ROA. (www.businessdictionary.com).
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