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© 2019 Conscientia Beam. All Rights Reserved. 

PROFITABILITY OF COMMERCIAL BANK ON INTEREST RATE DEREGULATION     

 

 

 Tijjani 
Muhammad1+ 

 Abatcha Melemi2 

1Department of Islamic Studies, (Islamic Banking and Finance) Federal 
University, Gashua Yobe State, Nigeria 

 
2Department of Economic and Development Studies Federal University, 
Gashua Yobe State, Nigeria 

 
  

(+ Corresponding author) 

 ABSTRACT 
 
Article History 
Received: 3 December 2018 
Revised: 8 January 2019 
Accepted: 13 February 2019 
Published: 21 March 2019  
 

Keywords 
Commercial bank 
Interest rate 
Deregulation 
Impact 
Profitability 
Lending. 
 

JEL Classification: 
G18; G28. 

 
This study focuses on impacts of deregulation policy of interest rate on the profitability 
of commercial bank, which will create competition among conventional financial 
institution for their traditional activities of banks (Deposits, loans and other financial 
institutions activities). The demand and supply will increase to encourage fund 
mobilization based on interest rate. Sanity becomes significant in the financial 
institution as utilization of fund is been judiciously encouraged and invests it to the 
most profitable ventures. The study explored the survey questionnaire by selecting five 
financial institutions and distributes twenty (20) questionnaires for each financial 
institution to their respective managers (experts) for their input. The simple description 
analysis and correlation were considered for variables comparison to achieve the 
research objectives. The research findings indicate that the deregulation significantly 
contributed to the profitability of commercial financial institution and promote 
competition among their counterpart. The study also reveals that the deregulation in 
interest rate leads to an increase in profit maximization. The study recommended the 
changes in the discount rate will reflect a stipulated range depending on how monetary 
policy pursued and the relation of a current market economy with interest rate, the 
sufficient control of the institutions and regulatory bodies to ensure the forces driving 
the economy as adequately managed and controlled.  
 

Contribution/Originality: This study contributes to the existing literature on the interest rate deregulation. 

The study uses a new estimation methodology as a structural survey questionnaire which used correlation and 

descriptive analyses. The study is one of the very few studies based on deregulation of the interest rate on 

commercial bank.  

 

1. INTRODUCTION 

Before the introduction of market base policy in 1987, the interest rate management was controlled by the 

Central Bank of Nigeria, which restricted the minimum and maximum savings rates of lending for financial 

institutions. After the introduction of market policy banks were allowed to run their activities based on negotiation 

with customers, the banks were also directed to pay interest on current account deposits by the Central Bank of 

Nigeria on the deregulation context of the framework. This, obscure the indirect negotiation between the customers 

and their banks based on the payable interest rate for special purpose deposit held between stipulated periods of 

time. However, assurance of exploitation on customers is totally expelled, the Central Bank of Nigeria has directed 

the implementation of reducing balanced method and should be considered and applied on loan charges based on 

Financial Risk and Management Reviews 
2019 Vol. 5, No. 1, pp. 1-9 
ISSN(e): 2411-6408 
ISSN(p): 2412-3404 
DOI: 10.18488/journal.89.2019.51.1.9 
© 2019 Conscientia Beam. All Rights Reserved. 

 
 
 

 
 
 

 

 
 
 
 

https://orcid.org/0000-0002-7628-8587
https://orcid.org/0000-0003-4210-2462
https://www.doi.org/10.18488/journal.89.2019.51.1.9


Financial Risk and Management Reviews, 2019, 5(1): 1-9 

 

 
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installment agreed payable. The Minimum Rediscount Rate (MRR) continued to regulate the fixed charges by the 

Central Bank in line with overall economic conditions. For example, MRR in August 1987 fixed the rate at 15% by 

December 1987 was reduced to 12.7% with the aim to improve the stimulation investment and attract a Foreign 

Direct Investment followers and sound monetary policy (Vaghefi et al., 1991).  

The MRR raised flexible interest rate to 13.2% in occurrence of flexible policy in 1989, in same year, the 

Central Bank of Nigeria (CBN) developed Treasury bill and Certificate (Securities), under the system that 

authorized dealers’ submission of competitive bids that issued rate emerge. Lack of deposit and lending structure 

concurred the immense responsiveness in market fundamentals which manifested in 1990 declined of inflation that 

forced the authorities to fix a minimum spread between the cost of commercial funds and merchant fund for their 

maximum lending rates. Therefore, the banks were directed to ensure the minimum deposit rate of 13.5 and lending 

rate at 21%. The banking considered that as obviously against the government deregulatory posture, however, the 

reported rate considered within the guideline and was sufficient to prove the essential rate as higher as the policy 

was largely sideline, and that was removed January 1992 (Hien and Hanh, 2013). In 1993 the policy was retained in 

the course of interest rate only volatile and distorted it and raised unpredicted levels. The interest rate behavior was 

traceable under these factors. The high arising of domestic inflation resulted in huge fiscal deficit of the Federal 

Government which Central Bank of Nigeria financed. The interest rate deregulation conferred on the arbitraging 

activities of the market speculation. The insolvency in cash flow distress borrowing resulting to the weak banking, 

the system allocation, foreign exchange on both sterilization and Indus of a large fund at the CBN. In 1993, high 

interest prevailing, discourage investments and productive spirit of the economic and the volatile interbank 

undermined the efficiency of free market activities and steadiness of financial system. In 1994, major regulations 

were reintroduced in the management of interest rate due to the vast variation of high rate; this policy was 

maintained and reconsiders some modification for flexibility. Furthermore, the situation remains in 1996 and 1997. 

The regulation of interest rate resulted widening the deposited interest gap under the Structural Adjustment 

Program (SAP). However, some financial institutions argument that the cost of funds will be rising consider 

payable gap interest rate is not tenable as witness 1989, as regards the payment of current account of the interest 

rate deposits, financial institutions welcome ideas on competing to mobilizing deposits as objectives deregulation of 

interest rate under (SAP). 

 

2. LITERATURE REVIEW 

Interest rates are the crucial element in the transmission of Monetary Policy Action for both economics and 

banking activities, Adeniran et al. (2014). The interest rate in Nigeria has changed for example within the time 

frame of the regulated and deregulated regime. However, the impact of this variable on both the banking sector and 

economy remain controversial (Acha, 2011). According to Keynes (1923) an interest rate is a reward for not 

hoarding but for parting with liquidity for a specific period of time. This definition is more focused on the lending 

rate. Adebiyi (2002) an interest rate is a reward or yield on equity or opportunity cost of deferred current 

consumption into future. Lerner and Jhingan (2003) interest rate as the price which equates the supply of “ credit” 

plus the net increase in the amount of money in the period, to the demand for “credit” plus the net hoarding in the 

period. Ibimodo (2005) defined interest rate as the rental payment for the use of credit by the borrower and the 

return for parting with liquidity by the lender. defined interest rate as the real interest rate at which inflation is 

stable and the production gap equal to zero. However, Allen (1977) state that the interest rate is charged based on 

reason, but one is to ensure that creditor lower his or her exposure to inflation. Inflation causes a nominal amount 

of money in the present to have less purchasing power in the future. Wurgler (2000) said that interest rate 

deregulation leads to more efficient allocation in the financial market. Gan (2007) stated that lending policy affects 

commercial bankability to grant a loan. Amassoma et al. (2011) indicate that deregulation affects the bankability to 

grand loan.  



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2.1. Management of Interest Rate  

In 1962, the interest rate was introduced an instrument of monetary policy after the introduction of the 

monetary market; interest rate was made competitive to ensure repatriation in and abroad. Furthermore, the high 

government borrowing at that time reduced to the minimum cost of public debt. In the 1960s, interest played a 

significant and dominant role in enhancing and managing the monetary policy of the Federal Government. 

Therefore, the Structural Adjustment Programmed (SAP) was introduced with comprehensive economic 

restructuring in 1968. However, the government emphasized the reliance of market forces, which imitated some 

resolution reforms to structural amendments of monetary policy. The interest rate and foreign exchange were both 

important in market liberation and the financial institution sector (Fischer, 1997). The interest rate has an 

important role in managing monetary policy as one of the instruments uploaded by the Central Bank of Nigeria that 

was based on two assumptions; regulation of the interest rate and partial deregulation as interest rate remained one 

of the instruments of monetary policy of the Federal Government Annual Budget document or the monetary/credit 

policy circular of the Central Bank of Nigeria from time to time. In August 1987, the Central Bank of Nigeria 

liberalized the interest rate regime and adopted the policy of fixing only its Minimum Rediscount Rate (MRR). This 

was however modified in 1989 when the Central Bank of Nigeria CBN issues a further directive on the required 

spread between deposit and lending rate (Therrell et al., 2012). Partial deregulation was restored in 1992 when 

financial institutions were required to only maintain lending rates. The central bank of Nigeria announced the 

removal of maximum lending in 1993, the inflation interest rate started rising to an unprecedented level, which 

made the banks lending rate high and volatile that led to the fiscal deficit of the government and rose of inflation 

(Frankel, 1979). However, the policy to maintain money in circulation is the prior objective that economic growth 

targeted and maintains the level of interest rate and inflation required. In 1997, the policy of interest rate 

deregulation retained. Then, the beginning of the year was stabled in rate that abolished the statement undermined 

the power of interest rate fallen that also contributed declined deposit rate in the commercial banks from the 10.1% 

percent to 7.5% and later to 5.6% at the end of April 1997 (Fung and Hsieh, 2000). The monetary and other 

financial system policies were created to manage and maintain the internal and external balance of financial 

institution and lead to the primarily maintain inflation rate at single digit in order to achieve the objective. 

Similarly, monetary policies focused on dealing with excess liquidity and enhancing the viability of the sector as 

well as the stability of the financial system. Other important objectives of deregulation of interest rate enhancement 

growth of the economy and drastically reduced unemployment. According to Central Bank of Nigeria (1978) rated 

the financial performance indicated deposit lending rate fluctuates downwards and liquidity beetle in the financial 

institution with the reduction percentage of 18% to 14%, liquidity ratio from 40% to 35%  and Cash Reserve Ratio 

(CRR). On 5th June 2007, the Monetary Policy Committee (MPC) reviewed the major development and 

implementation of monetary and fiscal as well as challenges of exchange rate policies in microeconomic performance 

and satisfaction 

 

2.2. Classical Theory of Interest Rate 

According to the classical theory of interest rate is determined fork circle of the investment demand and saving 

schedule. This is disclosing the connection between saving and investment to the relation of interest rate. Similarly, 

the solution to the saving and investment were varied to a level of real income and a solution that will not be, if the 

investment opportunity is not there. Keynesian, attack the classical theory of interest rate by signifying the ground 

of undetermined from the income rise, while the saving schedule will shift to another direction. Hence, the 

determination of the rate of interest will not be, unless the income level is been specified and also the rate of 

interest, since a lower interest rate attract the larger volume of investment but a higher level of real income, the 

classical theory fails to offer a solution. 

 



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2.3. The Keynesian Theory of Interest Rate Determination 

This theory posits that “the rate of interests determined by the intersection of the supply schedule of money 

and the demand schedule for money. However, this analysis is also undetermined because the liquidity preference 

schedule will shift up or down with a change in the income level”. Thus, money supply and the demand scheduled 

cannot give the rate of interest unless we already know the income level hence, the same criticism of indeterminacy 

Keynes leveled against the classics is applicable to his theory. 

 

2.4. The Loanable Theory of Interest Rate Determination  

According to the loanable funds' theory of Dennis H Robertson, “the rate of interests is determined by the 

intersection of the demand and the supply schedule of the loanable funds. Here, the supply schedule is compounded 

of saving plus net addition to loanable funds from the new money and the dishoarding of the idle balance”. 

However, since the saving portion of the schedules varies with the level of disposable income, it fellow that the total 

supply schedule of loanable funds also varies with income. 

 

2.5. Neo Classical Theory of Interest Rate Determination 

In the Pigouvian statement, "The interest rate is determined by the intersection of demand schedule of money 

and the supply schedule of saving”. Here the pertinent supply booked is imagined as far as sparing out of current 

income, i.e. the abundance of aggregate pay from services in accommodating utilization. Accordingly, income, 

utilization, and saving, all apply to a similar period, be that as it may, regardless of whether current income 

bolstered in past from infusion of new money from the viewpoint of the Pigouvian or neoclassical definition. That is 

income whether it springs from the spending of assets obtained from bank credit assumed a job during the time 

spent in income creation. In this manner, in the neoclassical or Pigouvian theory 'reserve funds' is in actuality 

indistinguishable thing from loanable assets thus similar reactions apply to them. 

 

3. METHODOLOGY  

Data for this study were accessed from the primary data through the field survey using a structured 

questionnaire as a major research instrument. On the other hand, were obtained from relevant stakeholders and 

expertise in the field of financial institutions for the data collection. As a result of the inability of the researcher to 

effectively study the whole bank under study, a representative number was chosen as the sample size population. 

One hundred (100) people were used as the sample size. Some number of individuals were been selected from the 

five (5) different banks (Gtbank, First Bank, Access Bank, Unity and Union Bank) and 20 respondents from those 

banks, which they were classified as expert in the field. One hundred (100) questionnaires were considered as the 

sample size of the populations. 

 

3.1. Method of Analysis 

The data collected was efficiently analyzed for easy management and accuracy. Similarly, the analytical tools 

used for the research was descriptive and correlation those were used to justifies the relationship between the 

variables as predicted and also reached conclusion for determining the critical value of the research.  

 

4. DATA ANALYSIS, FINDING AND DISCUSSION 

This section explored the study presentation and analysis of the research result as gathered through 

questionnaires. The data collected from the research were arraigned based on the need and description of the study. 

The demography and correlation information was presented in the section as adopted to test the research questions.  

 

 



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4.1. Demographic Analysis 

 
Table-1. Gender of respondents. 

Gender Frequency Percentage Valid percent Cumulative percent 

Female 69 69.7 69.7 69.7 
Male 30 30.3 30.3 100.0 
Total 99 100.0 100  

    Source: Author Designed. 

 

The Table 1 shows in gender distribution of the respondent used for this study. 69 respondents represent 

69.7percent of the population are female while the remaining 30 respondents represent 30.3 percent of male. 

 
Table-2. Deregulation of interest rate has something to do with bank profit. 

Stage of Acceptance Frequency Percent Valid percent Cumulative percent 

Strongly agree 39 39.4 39.4 39.4 
Agree 50 50.5 50.5 89.9 

Undecided 2 2.0 2.0 91.9 
Disagree 3 3.0 3.0 94.9 

Strongly disagree 5 5.1 5.1 100.0 
  Source: Author Designed. 

 

The Table 2 shows that deregulation of interest rate has something to do with bank profit. 39.4 percent have 

strongly agree that deregulation of interest rate has something to do with the bank profit 50.5 percent agree that as 

stated by Therrell et al. (2012). Reported that the all control on interest were removed this indicate that desired 

interest rate will charge by the bank to get profit. 2.0 percent were undecided 3.0 percent have disagree that 

deregulation of interest rate has something to do with bank profit. And 5.1 percent have strongly disagree that 

deregulation of interest rate has something to do with the bank profit. 

 
Table-3. Deregulation of interest rate has increase the commercial bank profit. 

Stage of Acceptance Frequency Percent Valid percent Cumulative percent 

Strongly agree 49 49.5 49.5 49.5 
Agree 25 25.3 25.3 74.7 

Undecided 5 5.1 5.1 79.8 
Disagree 10 10.1 10.1 89.9 

Strongly disagree 10 10.1 10.1 100.0 
Total 99 100.0 100  

 Source: Author Designed. 

 

The Table 3 shows that deregulation of the interest rate has increase the commercial bank profit.  49.5 percent 

strongly agree that the deregulation of the interest rate has increased the commercial bank profit. 25.3 percent 

agree that deregulation of the interest rate has increased the commercial bank profit. Amassoma et al. (2011) 

interest rate deregulation lead to more efficient allocation in financial market which also is in the view that it 

increase the commercial bank profit. 5.1 percent were undecided. 10.1 percent have disagree that deregulation of the 

interest rate has increase the commercial bank profit. 10.1 percent have strongly disagreed that the deregulation of 

the interest rate has increase the commercial bank profit. 
 

Table-4. Lending policy affects the commercial bank ability to grant loan. 

Stage of Acceptance Frequency Percent Valid percent Cumulative percent 

Strongly agree 49 49.5 49.5 49.5 
Agree 30 30.3 30.3 79.8 

Undecided 5 5.1 5.1 84.8 
Disagree 10 10.1 10.1 94.9 

Strongly disagree 5 5.1 5.1 100.0 
   Source: Author Designed. 



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The Table 4 that lending policy affects the commercial bank ability to grant loan. 49.5 per cent strongly agree 

that lending policy affect the commercial bank ability to grant loan. 30.3 percent agree that lending policy affect the 

commercial bank ability to grant loan.  5.1 percent were undecided, according to Chodechai (2004) as stated that 

lending policy affect the commercial bank ability to grant loan because interest will be charge based on stated 

lending rate which affect the bank ability to grant loan. 10.1 percent disagree that lending policy affect the 

commercial bank ability to grant loan. 

 
Table-5. Interest rate deregulation affects the bank ability to grant loan. 

Stage of Acceptance Frequency Percent Valid percent Cumulative percent 

Strongly agree 39 39.4 39.4 39.4 
Agree 50 50.5 50.5 89.9 

Undecided 2 2.0 2.0 91.9 
Strongly disagree 5 5.1 5.1 97.0 

Disagree 3 3.0 3.0 100.0 
   Source: Author Designed. 

 

The Table 5 shows that interest rate deregulation affects the bank ability to grant loan. 39.4 percent strongly 

agree that interest rate deregulation affects the bank ability to grant loan.  50.5 percent agreed that interest rate 

deregulation affects the bank ability to grant loan (Amassoma et al., 2011) says that expert agree while other 

disagree like Ojo (1988) indicated that deregulation affect the bank ability to grant loan, this is because once 

interest rate was left uncontrolled it will lead to increase in profitability by charging high rate of interest.  

 
Table-6. Government policy on commercial bank affects its ability to grant loan. 

Stage of Acceptance Frequency Percent Valid percent Cumulative percent 

Strongly agree 39 39.4 39.4 39.4 
Agree 30 30.3 30.3 69.7 

Undecided 15 15.2 15.2 84.8 
Disagree 10 10.1 10.1 94.9 

Strongly disagree 5 5.1 5.1 100.0 
   Source: Author Designed. 

 

The Table 6 shows that government policy on commercial bank affects its ability to grant loan. 39.4 percent 

strongly agree that government policy on commercial bank affects its ability to grant loan. 30.3 percent agree that 

government policy on commercial bank affects its ability to grant loan. Allen (1977) deregulation of interest rate 

will cut down borrowing as interest rate will be high, this affects the bank ability to grant loan, 10.1 percent 

disagree that government policy on commercial bank affects its ability to grant loan. 5.1 percent disagree that 

government policy on commercial bank affects its ability to grant loan. 

 
Table-7. Government policy on commercial bank should be encouraged. 

Stage of Acceptance Frequency Percent Valid percent Cumulative percent 

Strongly agree 49 49.5 49.5 49.5 
Agree 15 15.2 15.2 64.6 

Undecided 15 15.2 15.2 79.8 
Disagree 10 10.1 10.1 89.9 

Strongly disagree 10 10.1 10.1 100.0 
   Source: Author Designed. 

 

The Table 7 shows that government policy on commercial bank should be encouraged. 49.5 strongly agreed 

that government policy on commercial bank should be encouraged. 15.2 percent agreed that government policy on 

commercial bank should be encouraged. 5.2 were undecided. 10.1 percent disagree that government policy on 

commercial bank should be encouraged. 

 



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Table-8. Matrix Correlation Result indicating the relationship between the variables. 

Variable (1) (2) (3) (4) (5) (6) (7) (8) (9) 

Sex 1         

Age .877** 1        

Academic  qualification .585** .713** 1       

Deregulation of interest .623** .836** .625** 1      
Deregulation of interest 
increase commercial bank 

.858** .948** .691** .823** 1     

Leading policy affect 
commercial bank 

.795** .922** .683** .858** .970** 1    

Interest rate deregulation 
ability to grant loan 

.629** .840** .644** .991** .826** .854** 1   

Government policy on 
commercial bank 

.869** .949 .725** .888** .933** .942** .889** 1  

Government policy on bank 
should be encouraged 

.872** .939** .741** .818** .976** .956** .824** .937** 1 

    Source: Designed by the Author.  The level of the acceptance base on the table above is 0.7> and above, anything below <0.6 will be rejected. 

 

The Table 8 shows the result of the correlation of the research variable which used to test the significant 

correlation between the variables on each other. The level of the acceptance based is 0.7 and above while anything 

below 0.6 is rejected. 

Deregulation of interest rate has something to do with bank profit and Lending policy affects the commercial 

bankability to grant loan and decision shows the significant correlation between the two variables in the research 

since the level of the significance is 0.85 which is greater than >0.6 level of the rejection. 

The correlation between Government policy on commercial bank should be encouraged the deregulation of the 

interest rate has increased the commercial bank profit. However, the decision indicates the strong relationship 

between the two variables at the high level of significance of 0.97 which is greater than the 0.6 rejection level. Age 

of the respondents with their academic qualification of the respondents indicates the strong correlation between the 

age of the respondents with their academic qualification since the level of the significance is 0.71 which is greater 

than 0.6 level of the rejection and that show the level of awareness of experts with the policy and activities of 

financial institutions. 

 

4.2. Discussion 

This study examined the impact of the profitability of commercial bank in Nigeria on interest rate deregulation, 

the author used simple percentage to analyze the research variable and also correlation was used to test the 

significance of the variable relationships. This study was made to check whether the commercial bank is earning 

profit from the market base interest rate, this is due to the fact that before 1986 the rate of interest on both the 

lending and deposit was regulated by the government, which commercial bank has no power on the interest rate 

determination. But after the deregulation of 1986, the rate to be given and the rate to be charged was based on force 

in the market. 

The researcher used the appropriate method to determine and analyses the outcome, the research also reveals 

that 69% of the respondents are male and which are actively participating in the banking activities and the business 

that in the one hand or the other has relationships with bank profit on deregulation policy period. It has also 

observed that the respondent have to see both the era of the regulation and the deregulation of the interest rate 

which reveal that commercial bank earned profit more during the deregulation of the interest rate because their 

ability to grant loan has increased. 

In addition, it has also agreed that deregulation of the interest rate has something to do with bank profit, this is 

suggesting that commercial bank is earning more profit only during the deregulation period of the interest rate 

(Therrell et al., 2012) when all the control were removed, commercial bank will gain profit, this is because all 

restriction by the government was removed which lower the profit of the bank.  With the deregulation of the rate of 



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interest, then the bank will charge interest base on the level of saving and lending, this proves that deregulation has 

contributed to the profit of the commercial bank. It has also been observed that deregulation of the interest rate has 

increased the commercial bank profit, in the sense that the rate of interest will now be determined by the market 

force. Government intervention will be all removed so that the commercial bank will increase the fund by raising 

the interest on saving so that it will have more to lend to the businesses will, in turn, raise its profit. Nwankwo 

(1989) shows that deregulation leads to more efficient allocation in the financial market which also increase the 

commercial bank profit, this is also evident that 70% of the respondents agreed that deregulation gas increases the 

bank profit. 

The regulation period of interest rate was not beneficial to the commercial bank this is because all the interest 

rate to be charge are determined by the government authority, Gan (2007) also stated that lending policy by 

government affect the bank to grant loan, since bank will not be in the position to grant loan due to such restrictive 

policy on the interest, the commercial bank profit is very low, this is also from the research that 79% agreed that 

government policy reduced the bank profit. 

This deregulation of interest rate has serious positive effect on the profit made by commercial bank because 

deregulated rate of interest encourage rate of interest on saving and also lending rate will be raised to make profit 

from the fund given out for loan, Ojo (1988) shows that when interest rate was left to be determined by market, 

then the bank will charge high-interest rate which will positively increase the profit of commercial bank. It has 

witnessed that any attempt by the government to control the rate of interest will negatively lead to falling down on 

interest which will affect the profit of the commercial bank. Emphasis should be made on deregulation which 

enhances the business environment to grow and led to an increase in the bank profit. 

We can expect that deregulation has a large impact on the real economy only if there are important changes in 

the structure and efficiency on the banking industry resulting from the reform .although the key changes are as 

fellows; relaxing the restriction on the bank and expansion of the led to larger bank operation across the country. 

Following such idea of deregulation, we can see that under the deregulation, commercial bank profit increasing 

more and more but within the regulation period, the commercial bank is earning a low profit when compared to the 

deregulation period of the interest rate. 

 

5. CONCLUSION 

Based on the study finding, we have seen how deregulation of interest rate contributed to the commercial bank 

profitability. So the researcher hereby concludes that interest rate deregulation has contributed reflectively to the 

profitability of the commercial bank. It has also engendered competition in the midst of the bank and other 

institution of deposit. Saving enlistment has been encouraged through demand and supply that resolute the interest 

rate. Perhaps, it’s induced the financial institution to spring for idle funds, and sending to deficit area to gingered 

loan in advance. Sanity is been encouraging in some bank area as they are now beat on sensible used of this 

available funds and hence allocated to most profitable venture. 

The research recommended for further research on deregulation on commercial banking under time series, 

granger causality and financial reports on banking sectors. 

 

Funding: This study received no specific financial support.    
Competing Interests: The authors declare that they have no competing interests.  
Contributors/Acknowledgement: Both authors contributed equally to the conception and design of the 
study. 

 

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