benefits of consolidation of Nigeria Banks includes :-
•The liquidity engendered by the inflow of funds into the banks induced interest rate to fall drastically while an unprecedented 40% increase has been recorded in lending to the real sector.
•With higher single obligor limit, our banks now have greater potential to finance big ticket transactions.
•Already, more banks now have access to credit lines from foreign banks (one recently received $250 million from two foreign banks--- this is unprecedented.
•Ownership of the banks has been diluted. This will in no small way tame the monster of insider and corporate governance abuse.
•With virtually all the banks now publicly quoted, there is wider regulatory oversight; with SEC and NSE joining the team. Regulatory resources would now be focused on fewer and more stable banks.
•Depositor confidence is bound to be greater and interest rate on deposit lower due to “safety in bigness” perception by depositors.
•The banks will of course enjoy economies of scale and consequently, pass on the benefit in the form of reduced bank charges to their customers.
•The capital market deepened and consciousness about it increased significantly among the population. The market has become more liquid and the total capitalization markedly increased.
Source: Press Conference by PROFESSOR CHARLES C. SOLUDO, GOVERNOR, CENTRAL BANK OF NIGERIA ON The Outcome of the Banking Sector Recapitalization and the Way Forward for the Undercapitalized Banks 16 JANUARY 2006
http://www.cenbank.org/OUT/SPEECHES/2006/Govadd%2016-1-06.pdf