| dc.description.abstract | This study investigated the impact of branch network on cornrnercial
banks' performance using a hybrid of descriptive and analy:ic
methodology. In particular a profit function was specifiec and
estimated. Cross-sectional secondary data obtained from the. banks
balance sheets and other records for the period 1988-89 was ana lysed
using ordinary least squares (OLS) regression method. Performance
was found to be enhanced by opening more offices in the large urban
centres. Decline in profitability due to branching in rural areas
was, however, found to be small in macnitude but statistically
different from zero at the 5 percent level of significance. This
was explained by lack of banking habit and absence of industrial and
commercial activities in the rural sector. The policy issues
arising from these findings are two fold. To facilitate resource
mobilization, a positive rural branching orientation is necessary.
Secondly, potential entrepreneurs in the banking industry stand to gain by taking the banking services to the rural mass and educating
them on the benefits of banking services. These call for
delocalization of industrial and commercial activities from large
urban centres to rural areas or establish and/or encourage more
state banks which would consider taking banking services to the
rural areas as their priority | en |
