THE ROLE OF FINANCIAL INSTITUTION IN ENHANCING BUSINESS ACTIVITIES
(A CASE STUDY OF FIRST BANK NIGERIA PLC.
CHAPTER ONE
INTRODUCTION
1.1       BACKGROUND OF THE STUDY
The level of economic development is a sum total of all the effective and efficient business activities of the country weather home or abroad. The financial institutions have a very important role to play in this development. The survival and future of a given country is hooked on to the volume of business activities going on that country also the availability of fund financing the activities is necessary.
The sole purpose of financial institutions is to aid private individuals and government to finance their business project. Finance could be termed as the propeller that causes business activities to progress.
There are financial institutions that deals with physical cash transaction these institutions are known as banking Financial Institution for examples First bank Nigeria Plc. Also there are other financial institution though not bank but they complement the activities of the banks in financial business projects these institutions are known as the Non-Banking Financial Institutions, they include insurance companies, National Provident Fund (NPF). The comparative societies, investment companies, financial companies, pension scheme etc.
In addition, there are various markets that made-up the financial institutions. There are as follows:-
a.                   Liquid Capital and Money Market: Long and short term lending and borrowing instruments are treaded by the owners and users of funds.
b.                  Stock Exchange Market: In this market the share of companies are declared for interested agents to buy.
c.                   Foreign Exchange Market: The market creates opportunities for foreign exchange for the benefits of investors in carrying out international business.
For the purpose of this study; the researcher will be writing on the banking financial institution but before limiting it to the case study below is a brief history of commercial bank in Nigeria.
 COMMERCIAL BANKS IN NIGERIA
Commercial banks in Nigeria dates back to the early colonial period. The decline in barter system of trade and the rise in financial transactions of the colonial government, government required an institution in the form of a commercial bank for safety and transmission of funds. It was based on this reason that African banking corporation in South African was invited in the year 1982 to established a branch in Lagos by the trade depression that year in Lagos could but allow it existence.
In 1894, Bank of British West Africa took over its operations. The bank of Nigeria was established by the Royal Niger Company in 1899. In 1912, the bank of British West Africa absorbed the bank of Nigeria and exercise monopoly over banking in Nigeria. However, in 1925, the Barclay Bank started operations in Nigeria and in the later years other colonial banks joined.
In 1973, the banking industry was indigo used by the Federal Government and this brought about the end of existence of expatriate banks in Nigeria.
1.1.1        BRIEF HISTORY OF FIRST BANK NIGERIA PLC
For over a century, first bank Nigeria PLC, has distinguished itself as a leading banking institution and a major contributor to the economic advancement and development of Nigeria.
In 1894, the bank commenced as a small operation the office of elder Dempster and company in Lagos by a shipping magnate from Liverpool sir Alfred Jones.
It was incorporated as a limited liability company on 31st March 1894 with head office at lever pool. It started business under the corporate name of the Bank for British West Africa (BBWA) with a paid up capital of 12,000 pounds sterling after absorbing its predecessor; the African Banking Corporation, which was established earlier in 1892. This lead to the prominent position, which the bank was to establish in the banking industries in West Africa.
In the early years of operations, the bank recorded an impressive growth and work closely with the colonial Government in performing the traditional functions of a Central Bank, such as issue of space in the West Africa sub-region.
 In 1896 a branch was opened in Accra in Ghana so as to justify its West Africa coverage also in 1898, another branch was opened in Freetown, Sierra Leone. This operation marks the beginning of the bank international banking operation.
1900, the bank established a second branch in Nigeria and this was located in Calabar, two year later the operation was extended to the Northern part of Nigeria.
The bank has a network of 315 branches throughout the federation including a branch in the city of London and it maintains the largest branch network in the banking industry.
To grant customers satisfaction, First bank has diversified into a wide range of banking activities and services. These include corporate and retail Banking, Registrar-ship, Trusteeship and Insurance brokerage.
1.2              STATEMENT OF THE  PROBLEM
Banking is a long-term undertaking of which expected funds are committed to enterprises to pay back within a period of time, for about twenty (20) years depending on the type of loan.
As a result of unforeseen circumstances, many enterprises are constrained to request for extension as failure to pay back could be due to instability of government policies.
Problems such as frequent appointment of directors, government subventions that is structural adjustment programme (SAP), diversion of loans by directors into personal or private use, the privatization and commercialization drive nonchalant attitude to work, over lending or descriminary lending, poor recovery machinery and may be inefficiency on the part of the management.
1.3       PURPOSE OF THE STUDY
The sole purpose of carrying out this research is to identify the role of financial institutions (Banks) in enhancing business activities in the Nigeria economy, particular reference will be made to First Bank of Nigeria PLC
The research will boil down to the topic of the research work and all the problems it encounter the nation’s economy development and as well recommend some possible solutions.
1.4       SCOPE OF THE STUDY
This research work covers the specific roles financial institution plays in enhancing business activities and its consequence effect on the Nigeria economy during the process of executing the roles. Special reference will be on First bank of Nigeria PLC as a case study.
1.5              RESEARCH QUESTION
The quest to find out the role of financial institutions in enhancing business activities has brought about the following research questions.
a.                   To what extent does your bank allow over draft to customers?
b.                  Dose your bank offer loans to customers?  
1.6              RESEARCH HYPOTHESIS
The researcher will make use of the following hypothesis
Ho:      Customers are not satisfied with services rendered by First Bank Nigeria Plc.
Hi:       Customers are satisfied with services rendered by First Bank Nigeria Plc.
Ho:      Customers do not often come for advisory services.
            Hi:       Customers often come for advisory services.
1.7              SIGNIFICANCE OF THE STUDY
This research study will be of help to the entire economy, the government various business organizations and other banks in their policy decisions as well as help to improve their performance. The significance of the study in based on the importance of financial institutions towards the enhancement of business activities in the Nigeria economy.
1.9       DEFINITION OF TERMS
Role:-  duty in an undertaking
Financial:       management of money
Institution:     process of instituting social activities.
Enhanced:      to add value to something
Propeller:       encourage, supporter of business activities.
Transaction:  The act of carrying out business activity with somebody or an organization.
Activities:       Being active in business. Programme going on in the business would.