CHAPTER ONE

1.      INTRODUCTION

1.1     BACKGROUND OF THE STUDY

Commercial Banking operation in Nigerian started sometimes in 1891 when it become apparent that banking facilities was urgently needed especially. IN 1892, THE African Banking Corporation – the first commercial bank in  Nigeria was established to cater for the distribution of Bank of England notes on behalf of the British treasury. The bank later wound up its operation in 1892, and in 1893, Elder Dempster and Co. were approached and through the initiative of Sir Alfred Jones, another Bank was opened the Bank of British West Africa (B.B.W.A) in 1893, the bank was thus registered in England as a Limited Liability Company on 31st March 1894. its Head Office was in Liverpool (with a staff of only two). The Lagos branch office was also opened in the same year.

                The credit creation in the banking industry in Nigeria handled the import and export of mint coins, until 1959 when the Central Bank of Nigeria was established.

                Commercial bank can be defined as dealer in money and credit holding itself out to receive from the public, deposits repayable on demand by cheque. The National Bank  of Nigeria was established on a sound footing due to greater post activities, the bank had to close down, between 1915 and 1947, four indigenous banks was setup only to show and survived, the two banks that survival were African Continental Bank (ACB) and Agbon-magbe Bank  which is now called Wema Bank of Nigeria Plc.

                Commercial banks play an important role in the allocation of funds to individual and business organization in the society. One of the principal functions of Wema Bank in the creation of credit facilities which is the process of distributing of fund to potential utilized to ensure that anticipated to fits to the borrower and lending bank.

                Credit facilities are being enjoyed by the account holders individuals and co-operate bodies, monetary aspect of the economy which involves the mobilization of founds from their trade for expansion purpose from other sources through friends and others, their last result is to source for funds from the government bank which play with attention to the flight of the leader.