Financial Derivatives And The Development Of Nigerian Banks
| dc.contributor.author | Iyere, Samuel Iheonkhan | |
| dc.contributor.author | Samuel, Tende | |
| dc.date.accessioned | 2023-12-10T17:41:09Z | |
| dc.date.available | 2023-12-10T17:41:09Z | |
| dc.date.issued | 2011-09-12 | |
| dc.description.abstract | Financial derivatives have grown rapidly in recent years in developed economy due to improvements in computer technology, innovations in financial theory, and the need to manage risks arising from volatility in the interest and currency exchange rates. Derivatives are increasingly being used to manage various kinds of risk exposure, to obtain desirable financing, and to enhance investment and speculative opportunities. This paper examines the role offinancial derivatives in the development of Nigerian banks. It successively sketches the main features of financial derivatives and the related regulatory issues. We find that development of financial derivatives is justified in Nigeria by volatility in output, prices, currency, exchange rates, interest rates and inflation. The use of derivatives by Nigeria banks would provide avenue to new products and thus reduce tension, unhealthy competition and inefficiency in pricing as is currently the case with the sourcing of deposits. In addition, the sooner the Nigerian banks understand and trade derivatives, the sooner Nigeria will emerge as an international financial centre representing the African region. The complexities of the derivatives markets are increasing every day, and it is important for the policy makers and regulators to understand these markets before embarking on it. The paper recommends for use by supervisory authorities and banks the set of guidelines formulated by Basle Committee on Banking Supervision on the sound risk management of derivatives activities '. In addition, the paper recommends that derivates should be accounted for in accordance with International Financial and Reporting Standard (IFRS). | en_US |
| dc.identifier.citation | Ajakaiye O, Fakiyesi T (2009). Global Financial Crisis, ODI Discussion Series Paper 8: Nigeria.Overseas Development Institute, London. Bodie Z, Kane, A, Marcus AJ, Mohanty P (2006) .'Investments, New Delhi: Tata McGraw - Hill Publishing Company Ltd. CBN (2000) Financial derivatives: Need for Disclosure Requirements and Supervision Banking Supervision Annual Report 2000 CBN (2011) Guidelines For FX Derivatives and Modalities for CBN FX Forwards, Jan 2011 Fischer DE, Jordan R J (2005). Security Analysis and Portfolio Management (6thed.) New Delhi: Prenticc-IIall of India Private Ltd. Lange M (2009). “Subprime Crisis” www.globalissues.com. Olowe, A.R. (2008) Financial Management Concepts, Financial System and Business Finance, Brierly Jones Nigeria ltd Lagos Phillip O (2011) bankers' committee 2011 maiden meeting which held in Abuja. Tsetsekos, G, Varangis P, (1997): The Structure of Derivatives Exchanges: Lessons from Developed and Emerging Markets, The World Bank, (Washington), Dec. | en_US |
| dc.identifier.uri | https://keffi.nsuk.edu.ng/handle/20.500.14448/748 | |
| dc.language.iso | en | en_US |
| dc.publisher | Department of Accounting, Faculty Of Administration, Nasarawa State University, Keffi | en_US |
| dc.subject | Derivatives, Financial Market, Options, Over the Counter, Future Contract, Forward Contract | en_US |
| dc.title | Financial Derivatives And The Development Of Nigerian Banks | en_US |
| dc.type | Article | en_US |