By Nwachukwu, Remigius I
I n performing their role as financial intermediaries, the banks provide the
platform for the transfer of funds from surplus economic units to deficit
ones thereby helping in facilitating business transactions and economic
development. Since the funds being deployed by the banks are largely
owned by third parties (usually the depositors), it becomes necessary for
such funds to be prudently and efficiently managed so as to ensure the
sustenance of the confidence of the depositors in the banking system,
ensure that the financial system remain sound at all times and ensure that
the risk of bank failures is minimized.