The Effects of Asymmetry Window Corridor on the Performance of Deposit Money Bank in Nigeria
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Abstract
This study examines the effect of monetary policy instruments otherwise refers as asymmetry window corridor on the performance of deposit money banks in Nigeria from 2000 to 2020. Total private sector credit of deposit money banks was used to proxy the performance of deposit money banks while monetary policy rate, liquidity ratio, cash reserve ratio and loan to deposit ratio were used as proxies for monetary policy. The Ex-Post Facto research design was adopted in this study. Data on total private sector credit of deposit money banks, monetary policy rate, liquidity ratio, cash reserve ratio and loan to deposit ratio obtained from the Central Bank of Nigeria (CBN) Statistical bulletin (2020). The hypotheses of this study were tested using the Ordinary Least Square regression statistics. The findings revealed that total private sector credit of deposit money banks has a significant relationship on monetary policy rate; liquidity ratio and cash reserve ratio; while loan to deposit ratio has an insignificant relationship with total private sector credit of deposit money banks. The researchers recommended among other things that the central bank of Nigeria should redefine these monetary policy instruments to make them more attractive to the banks.
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