The Central Bank of Nigeria was established because of the anracteristic and difficult of the monetary system, which proceeded it.
In these case, the currency or legal tender obtaining in the colorizes before independence was issued by a currency board.
Also the development of indigenous banking and growth in the financial mechanism could not be achieved without the assistance of a central bank institution west African currency board which was established to finance the need of the expert trade of repatriate fixing in west African for the objective of issuing a spade convertibility a currency providing ream where by the colonial government might share in the profit of the currency was not impendent currency with Nigeria currency was tied on the spoon string of the British bound. It has no room for monetary management.
According to professor W. O. Ugoaga in his book tilled “money and banking in Nigeria”, the system was operationally right and institutionally limited it result that the board lacked any power to initiate and execute monetary policy. It also did nothing to train African in the art of monetary management or to develop indigenous banking and other financial institution which resulted that west African currency board had no discretionary power over the total amount of money and could not perform any banking functions.
The effects were that banking habit in the country was not develop.
Demand deposit constituted less than half the size of the currency e.g. nearly half of the deposited were held by government organization for the indigenous sector banking was even less significant because an over whelming part of deposit was held by Europeans and Europeans firms. No local investments out less were developed because it invested all its reserves in starting over sea in London.
The Central Bank of Nigeria was finally establish by Central Bank of Nigeria (CBN) ordinance in 1958 to issue legal tender currency in Nigeria to maintain external reserve to safe guard the inter national value of the currency to promote monetary stability and a sound financial structure in Nigeria to act as banker and an financial structure in Nigeria, to act as bankers and as financial advice to the Federal Government.
According to Professor G. O. Nwankwo in his book tilled “Nigeria Financial System. The Nigeria money was established by the Central Bank of Nigeria to enable government (as well as other financial institution) recoup them short fall in revenue and invest their surprises.
It’s therefore necessary to profit the extend the market has performed their function particularly. This period the government has been experiencing increasing short falls in revenue as a result of the glut in the world and market.
Ugwu, A.
(2018). THE ROLE OF THE CENTRAL BANK OF NIGERIA IN THE DEVELOPMENT OF MONEY MARKET. Afribary. Retrieved from https://afribary.com/works/the-role-of-the-central-bank-of-nigeria-in-the-development-of-money-market-100
MLA 8th
Ugwu, Anderson
"THE ROLE OF THE CENTRAL BANK OF NIGERIA IN THE DEVELOPMENT OF MONEY MARKET" Afribary. Afribary, 29 Jan. 2018, https://afribary.com/works/the-role-of-the-central-bank-of-nigeria-in-the-development-of-money-market-100. Accessed 08 Dec. 2023.
MLA7
Ugwu, Anderson
. "THE ROLE OF THE CENTRAL BANK OF NIGERIA IN THE DEVELOPMENT OF MONEY MARKET". Afribary, Afribary, 29 Jan. 2018. Web. 08 Dec. 2023. < https://afribary.com/works/the-role-of-the-central-bank-of-nigeria-in-the-development-of-money-market-100 >.
Chicago
Ugwu, Anderson
. "THE ROLE OF THE CENTRAL BANK OF NIGERIA IN THE DEVELOPMENT OF MONEY MARKET" Afribary (2018). Accessed December 08, 2023. https://afribary.com/works/the-role-of-the-central-bank-of-nigeria-in-the-development-of-money-market-100
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