Monetary Policy Decisions, Control of Money and Assets of Deposit Money Banks in Nigeria, 1981-2021. Auto Regressive Distributed Lag Model Approach

The broad objective of the study is to investigate the impact of monetary policy decisions in stimulating the assets of deposit money banks in Nigerian from 1981-to 2021. While the specific objectives are to Measure the impact of interest rate spread on assets of deposit money banks in Nigeria. Determine the impact of the exchange rate on assets of deposit money banks in Nigeria. Investigate the impact of private sector credits on assets of deposit money banks in Nigeria. The model used in this study is Autoregressive distributed lag as a form of multiple regression models. It is a special type of regression called autoregressive distributed lag. Result reveals that the Interest rate had a negative and non-significant impact on assets of deposit money banks in Nigeria, Exchange rate had a positive and significant impact on assets of deposit money banks in Nigeria, the Inflation rate had a negative and non-significant impact on assets of deposit money banks in Nigeria. The implication of findings reveals that if the government fails in its monetary policy decisions, it will go a long way to affect deposit money banks and also the economy. The study concludes that monetary policy decisions play seriously significant effects on the assets of deposit money banks in Nigeria. It was recommended that government should create reasonable credit for the private sector and therefore regulates the interest rate to be charged. Exchange rate has a significant effect on Insurance profitability in Nigeria. This study recommends that public enlightenment campaigns should be done by the government directing people about the availability of money kept for agricultural loans and various credits to control the black market in the exchange rate. It was recommended that effective policies such as policies that will encourage manufacturers to have access to bank credits without democratic bottleneck will go a long way to provide efficiency in the system and hence improves or control inflation; however, gradual control of inflation through mopping up excess liquidity will be done by the monetary authorities to enhance the growth of deposit money bank assets.