Select Currency
Translate this page


Format: MS WORD  |  Chapter: 1-5  |  Pages: 57  |  1313 Users found this project useful  |  Price NGN3,000





This research study was carried out to find the link between financial sector liberalization and capital market Development. As part of the Structural Adjustment Programme (SAP) of 1986, the Nigerian Government initiated a large scale restructuring Of the financial sector and the liberalization of the regulations concerning financial institutions and markets. This was justified on the basis of existing market failures which arose from externalities and lack of information. Using the econometric techniques, we found, that financial liberalization increased the real deposit ratio and also will lead to a substitution into financial asset resulting in a greater supply credit to finance real investment for capital market development and economic growth. Consequently, we recommend that for macroeconomic stability, efficiency and proper development of the financial system, direct control should be discouraged while indirect control should be encouraged through the market mechanism.                                                                                                




Just like other African Economies, Nigeria’s financial sector is underdeveloped and unorganized. It is characterized by dualism, market segmentation and spatial fragmentation [Iyoha, 2002]. Financial sector facilitates the conduct of trade transactions, the efficient use of financial resources, mobilization of savings and risk taking which are central to sustained Economic Growth and Development. According to T.W. Oshikoya and Osita Ogbu [1995], financial liberalization in several African countries has been implemented largely through Structural Adjustment Programs. In Nigeria, until the adoption of structural adjustment program in 1986, financial repression and bureaucratic control of interest rates were the order of the day.

Economic Development creates demands for particular types of financial arrangements and the financial system responds automatically to these demands. Finance, is argued to act as a catalyst in the process of Development but if repressed could become fetters or obstacles to the Growth process [Ikhide, 1997]. Even though the money and capital markets in Nigeria are not as deep as desirable, a start seems to have been made in the late 1980s and early 1990s to develop a more robust and balanced financial structure that would improve the ability of the domestic financial system to mobilize savings and contribute to self sustained Economic Growth [Iyoha, 2002].

The objectives of the liberalization are to build more efficient, robust and deeper financial systems, which can support the growth of private sector enterprise. Efficiency entails two components; which are improved credit allocation and more or higher quality financial services for a given level of inputs [Brown Bridge and Gayi, 2001]. The role played by the financial sector is an Economy can be important in determining Economic Growth. A growing empirical literature demonstrates that the Development of the financial system has positive effects on the long run rate of Economic Growth and the volume and efficiency of investment [Fry, 1995 Philip Arestis et al, 2002], through the removal of the elements of financial repression, particularly controlled interest rates, financial sector liberalization is expected to lead to higher nominal and real interest rate [Emenuga, 2001]. 

The capital market is divided into two segments: the primary market where companies’ shares are issued for the first time before being quoted on the stock exchange and secondary market where is trading is done in existing stocks. The capital market has served as a source of long- term fund to finance investment in the private sector of the Nigerian Economy. The liberalization of the financial sector involved liberalization of interest rates, promotion of market based system of credit allocation and enhancing completion and efficiency of the regulatory and supervisory framework [Ikhide, 1997]


This study attempts to examine the extent to which the liberalization policy has resolve the problems existing in the system which are direct controls, the pervasive Government intervention in the financial system and the resultant stifling of competition and resource misallocation. This study attempts to find out the extent to which the liberalization policy has resolve the problem of externalities, which relates to the distortions caused by high and volatile inflation. This study is concerned with the impact of the liberalization policy on the information problems, which is in the form of informational asymmetries between the suppliers and uses of financial services.


This study will undertake an analysis of the financial liberalization policy with a view to identifying the reason that led to the adoption of the policy. The focus will be on measuring the influence and effects of financial sector liberalization on some capital market Development indicators as far as the availability of Data permits. The period of the study is from 1970- 2004 in order to carry out a trend analysis on the before the liberalization period [1970 – 1985] and after the liberalization [1986 – 2004].


Financial sector reforms in Nigeria has embraced a number of policies designed to increase the size, improve the efficiency and raised the diversity of the financial system. This goal is achieved through financial liberalization which is viewed as the process of moving towards market- determined prices on all classes of financial products, characterized by symmetric entry and exit conditions to all participants increasing internationalization as represented by the opening up of domestic markets to international competition [Ikhide, Yinusa, 1998]. The liberalization of financial institutions and markets is an improvement in financial intermediation, which is considered a necessary condition for stimulating investment, raising productive capacity and fostering Economic Growth and Development.


The general objective of this study is to determine the extent to which financial liberalization have led to the development of the capital market in Nigeria. To achieve this general objective, the following specific objectives will be examined.

1. To provide a comprehensive insight into the structure of the capital market in Nigeria.

2. To examine the impacts of liberalization on the Development of the capital market.

3. To access the impact of reform policies like debt conversion programs.


This study will be based on the following Research Questions:

1. Has the financial sector liberalization measures been effective in achieveing its stated objectives?

2. Has the financial sector liberalization measures been able to solve the repressed nature of the Nigerian capital market?

3. Has financial sector liberalization measures improved the efficiency in resource allocation and quality of investment in Nigeria?


Ho: Financial sector liberalization does not have positive impact on capital market Development.

Hi:  Financial sector liberalization have a positive impact on capital market Development.

Ho: Capital market development does not have a positive impact on Economic Growth.

Hi:  Capital market developments do have a positive impact on Economic Growth.


The study will adopt Econometrics techniques to estimate the Models. We will use the Ordinary Least Squares (OLS) method of estimation and the Cochrane- orcutt correction method.


The Data used for this study are obtained essentially from the publication Central Bank of Nigeria statistical bulletin and Central Bank of Nigeria Annual Statement of Accounts. Others may be obtained from Nigeria Stock Exchange and other International Economic Journals.


The final report will be organized into five chapters.

Chapter 1     Introduction.

Chapter 2     Literature Review

Chapter 3.   Theoretical framework and Research Methodology for the Study.

Chapter 4.  Data Analysis and Interpretation Empirical Result.

Chapter 5.    Summary, Policy Recommendation and Conclusion.


Not What You Are Looking For?

For Quick Help Chat with Us Now!

+234 814 010 7220

+233 54 135 1187

Here's what our amazing customers are saying

Emmanuel Essential
Kogi state University
I actually took the risk,you know first time stuff But i was suprised i received as requested. I love you guys 🌟 🌟 🌟 🌟
Very Good
Azeez Abiodun
Moshood Abiola polytechnic
I actually googled and saw about iproject master, copied the number and contacted them through WhatsApp to ask for the availability of the material and to my luck they have it. So there was a delay with the project due to the covid19 pandemic. I was really scared before making the payment cause I’ve been scammed twice, they attended so well to me and that made me trust the process and made the payment and provided them with proof, I got my material in less than 10minutes
Very Good
Gbadamosi Solomon Oluwabunmi
Swift delivery within 9 minutes of payment. Thank you project master
Ajayi Crowther University, Oyo
I was scared at first when I saw your website but I decided to risk my last 3k and surprisingly I got my complete project in my email box instantly. This is so nice!!!
Ahmadu Bello University
I wish I knew you guys when I wrote my first degree project, it took so much time and effort then. Now, with just a click of a button, I got my complete project in less than 15 minutes. You guys are too amazing!
Temitayo Ayodele
Obafemi Awolowo University
My friend told me about iprojectmaster website, I doubted her until I saw her download her full project instantly, I tried mine too and got it instantly, right now, am telling everyone in my school about, no one has to suffer any more writing their project. Thank you for making life easy for me and my fellow students... Keep up the good work
Very Good
Stancy M
Abia State University, Uturu
I did not see my project topic on your website so I decided to call your customer care number, the attention I got was epic! I got help from the beginning to the end of my project in just 3 days, they even taught me how to defend my project and I got a 'B' at the end. Thank you so much iprojectmaster, infact, I owe my graduating well today to you guys...
Ibrahim Muhammad Muhammad
Usmanu danfodiyo university, sokoto
It's a site that give researcher student's to gain access work,easier,affordable and understandable. I appreciate the iproject master teams for making my project work fast and available .I will surely,recommend this site to my friends.thanks a lot..!
Dau Mohammed Kabiru
Kaduna State College of Education Gidan Waya
This is my first time..Your service is superb. But because I was pressed for time, I became jittery when I did not receive feedbackd. I will do more business with you and I will recommend you to my friends. Thank you.
Very Good
Joseph M. Yohanna
Thanks a lot, am really grateful and will surely tell my friends about your website.


  • Select 3 Project Topics of your choice from your Department.
  • Submit the 3 topics to your Supervisor for Approval.
  • Call Our Instant Help Desk on +234 814 010 7220 and Get Your Complete Project Material Instantly.
  • All project materials on this website are well researched by professionals with high level of professionalism.


How do i choose a Project Topic?

Look for your department and select any topic of your choice

I have a fresh topic that is not on your website. How do I go about it?

How fast can i get a complete project from your website?

Within 15 minutes if the exact project topic is on our website

Is it a complete research project or just materials?

It is a Complete Research Project i.e Chapters 1-5, Abstract, Table of Contents, Full References, Questionnaires / Secondary Data

One of your topics suites my project, but the case study is different. What do i do?

Call Our Instant Help Desk Now: +234 814 010 7220 and you will be responded to immediately

How do i get my complete project?

Your Complete Project Material will be sent to your Email Address in Ms Word document format

Can I get my Complete Project through WhatsApp?

Yes! We can send your Complete Research Project to your WhatsApp Number

What if my Project Supervisor made some changes to a topic i picked from your website?

Call Our Instant Help Desk Now: +234 814 010 7220 and you will be responded to immediately

Do you assist students with Assignment and Project Proposal?

Yes! Call Our Instant Help Desk Now: +234 814 010 7220 and you will be responded to immediately

What if i do not have any project topic idea at all?

Smiles! We've Got You Covered. Chat with us on WhatsApp Now to Get Instant Help: +234 814 010 7220

How can i trust this site?

We are well aware of fraudulent activities that have been happening on the internet. It is regrettable, but hopefully declining. However, we wish to reinstate to our esteemed clients that we are genuine and duly registered with the Corporate Affairs Commission as "PRIMEDGE TECHNOLOGY". This site runs on Secure Sockets Layer (SSL), therefore all transactions on this site are HIGHLY secure and safe!