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Monetary Policy and Deposit Liabilities of Deposit Money Banks in Nigeria

Oghenewiro, Augustine, Prof Onuorah, A C F, CIFIAN

Abstract

This study examined the effect of monetary policy on deposit liabilities of deposit money banks in Nigeria. Monetary policy was proxied with Reserve Requirement (RR), Cash Reserve Ratio (CRR), Monetary Policy Rate (MPR), Money Supply (MS), Interest Rate (INTR) and Exchange Rate (EXCHR) (Independent Variables) are examined on how it influence the deposit liabilities proxied with Total Deposit (TD) (Dependent Variable) of deposit money banks in Nigeria. The study was carried out in Nigeria for the period of 1993-2023 (31years). The study made used of secondary data (Time Series) which was sourced from the CBN statistical bulletin on the variables under study. Data was analyzed using the descriptive statistics, correlation matrix and several diagonistics tests, followed by the unit root test, ARDL Bound Co-integration test, and ARDL Co- integrating and Long form were utilised via Econometric Views version 9.0. The findings revealed that RR has a p-value of 0.1352 on the short run and a p-value of 0.9368 on the long run, respectively. This suggests that both in the short and long terms, RR has no significant effect on TD of DMBs in Nigeria. CRR has a p-value of 0.3996 on the short run and a p-value of 0.9339 on the long run, respectively. MPR has a p-value of 0.9499 on the short run and a p-value of 0.9686 on the long run, respectively. This suggests that both in the short and long terms, MPR has no significant impact on TD of DMBs in Nigeria. MS has a p-value of 0.1528 on the short run and a p-value of 0.9364 on the long run, respectively. This suggests that both in the short and long terms, MS has no significant effect on TD of DMBs in Nigeria. INTR has a p-value of 0.3241 on the short run and a p-value of 0.9336 on the long run, respectively. EXCHR has a p-value of 0.1656 on the short run and a p-value of 0.9329 on the long run, respectively. This suggests that both in the short and long terms, EXCHR has no significant effect

Keywords

Monetary PolicyReserve RequirementCash Reserve RatioMonetary Policy Rate

References

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