Impact Of Universal Banking In Nigeria

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The Nigerian banking and financial services competitive environment has changed radically. From the heydays of the financial services and banking boom of the 1990s, when the country was dotted with over 200 financial institutions – commercial banks, merchant banks, community banks, mortgage banks, finance houses - to the new dispensation in which the country progressed fully into the era of universal banking with 24 banks operating in the country (Sanusi, 2012). The faltering Nigerian economy and the banking industry experienced a systemic crisis in 2009, triggered by the global economic crunch, which was followed by the collapse of the Nigerian stock market. After the stock market collapse of 2009, during which 70% of value was eroded, many
The UB model allowed banks to diversify into non-bank financial businesses. The UB model was introduced in 2001 as part of a comprehensive reform and consolidation programme by the Central Bank of Nigeria (CBN) under the leadership of the erstwhile Governor of CBN, Professor Charles Soludo. As a result, Nigerian banks were consolidated through mergers and acquisitions, with the minimum capital base raised from N2 billion to a minimum of N25 billion. This policy reduced the number of Nigerian banks from 89 to 25 in 2005, and later to 24 (Sanusi, 2012; CBN Economic Report, 2013). One of banks that obtained the universal banking licence is FCMB – First City Monument Bank
Under the new model, licensed banks were authorized to carry out the following types of businesses: commercial banking (with regional, national and international reach); merchant (investment) banking; specialised banking (microfinance, mortgage, non-interest/Islamic banking); and, development finance (Sanusi, 2012). In response to this changing and evolving climate, an attempt to elevate HR’s perceived value to banking business emerged. Banks began to explore innovative strategies to attract professional and highly driven executives; this was in addition to massive manpower development programmes to re-train existing

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