Regulations of Other Financial Institutions in a Banking System Growth
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International Economic Society
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The banking system growth through capitalisations in Nigeria produced some after-effects, both salutary and
otherwise on the other financial institutions. The major objective of this paper was to find out the impact of the
growth of the banking system on the OFIs. The paper adopted both primary and secondary data to assess the impact
of the growth and regulation on the OFIs. The paper adapted the Regulatory Pressure Index to assess the perception
of regulation and supervision of the OFIs with granger causality and regressions and the main techniques of
estimation. Banks have grown at the expense of the OFIs, especially the MFBs and PMIs. Of the OFIs the most
negatively impacted have been the Finance Houses and Primary Mortgage Institutions. Growth in the banking
assets has been more aggressive than from the OFIs and the various sectors have impacted one way or the other
either negatively or otherwise. A further investigation with primary data using the nine RPI objectives indicates
that operators agree that there is inadequate supervision in the areas of capital adequacy, liquidity and products
offerings of the OFIs. The paper concludes by recommending the change in the mode of supervision and the
strengthening the Other Financial Institutions Department of the monetary authority or establishment of a new one
to oversee and adequately regulate the activities of the OFIs.
Keywords
HG Finance