Profitability And Liquidity In Commercial Bank

This is a work based on a topic which has been critically viewed by many people as an area which has been under serious treat in recent years.
The banking industry has for some times come under heavy supervision as to whether there should be any reliability on the industry or is it just collecting money from people today and then go in to distress, the next day. With the help of this reform program, the central Bank of Nigeria (CBN) has on July 2004 announced a major reform program aimed at transforming the banking landscape of the country. The main thrust of the 13 point reform agenda then was the prescription of minimum share holder’s funds of 25 billion not later than December 31 2005. Also the central bank of Nigeria (CBN) announced on the 1st of January 2006 that 13 out of 89 banks failed to meet its 25 billion capitalization target and therefore is to be liquidated. And then the number of banks that emerged at the consolidation exercise was 25 banking groups, and Afribank plc which is my case study is among those banks that were given fresh licenses to operate in Nigeria. This work is to bring to memories of people the role the banking industry plays and they generate its revenue. And expenditure further more, it went ahead to establish a firm prove on the relationship between profitability and Afribank Plc. The researcher went further to outline the functions of commercials banks. The core of its assets and liabilities how they most operate to remain liquid and the danger of excess liquidity.
The researcher analysed a financial report of the bank (Afribank Plc) and was able to show the growth trend of the bank and finally made recommendations on the liability of the bank and its prospect in the years to come.