Liquid represents the ability to work efficiently accommodate decrease in deposits and funds increase in the loan portfolio, that is to meet customers loan request fund commitments and liens of credit. A bank has liquidity potential when it has the ability to obtain sufficient cash in timely manner at a reasonable cost. The cost obtaining liquidity is a function of market conditions and the degree of risk, credit risk reflected in the balance sheet.
Liquidity management in Nigeria commercial banks ever the year has been a major issue of contention. It has generated a lot of thoughts and concerns to various groups through banking history. Academics and professionals take divergent views about the term liquidity and its management. Those who are involved in the management of the source and uses of fund deposit in commercial banks are raised to some degree.
There is virtually no work on the
liquidity management in Nigeria commercial banks. Thus, is the challenge of the research as its attempts to discuss it. The objective of this research work is to examine the liquidity management of commercial banks in Nigeria with more emphasis on their investment, liquidity and profitability position in order to find out why commercial banks need to be more liquid then any other business organization. This study will look at the effectiveness and efficiency of commercial banks in grapping with the management of their profitability by employing and using various approaches, theories and instruments in solving their liquidity and profitability dilemma.
There will be a thorough research to prove how the banks have been managing their liquidity and profitability. In this work both secondary and primary data were gathered and analysed. The primary sources was the administration of questionnaire and oral interview, while the secondary source was inform of literature review of books’ journals and newspapers.
From the findings of the analysis, the research came up with conclusion and recommendation.