Banks Consolidation and Real Estate Finance in Nigeria

The study evaluates the performance of commercial banks in real estate financing before (2000-2004) and after (2005 – 2009) the consolidation exercise of banks in Nigeria with a view to establishing its impact on real estate development. A total number of 255 questionnaire were administered on members of the Real Estate Developers Association of Nigeria while 157 of the questionnaire were retrieved for analysis representing 61.56% response rate. Also, data were obtained from 17 banks out of 19 consolidated banks in Nigeria representing 89.47% response rate. The remaining number of banks did not divulge information concerning their banks activities. The data collected were analyzed using the Mean Score Method and index numbers, t – test and Correlation Coefficient. Mean score and index numbers were used to measure banks’ performance while T-test and Correlation analysis were employed to establish whether there is difference between loan and advances of banks during the pre and post consolidation era, and the nature and degree of relationship of real estate financing and the banks’ capital base and the banks’ deposits. The result showed that the commercial banks’ performance in real estate financing only improved minimally after Banks’ Consolidation compared to the pre – consolidation era where no fund was allocated. The study recommends that the Federal Government should come up with policies to increase the percentage of commercial banks’ loans and advances to real estate secto