Bank consolidation policy in Nigeria is a measure to increase
A. the capital base of banks B. employment opportunities in banks C. the number of shareholders D. the number of branches
Correct Answer: A
Explanation
Bank consolidation is the process by which one banking company takes over or merges with another. This leads to a potential expansion for the merging bank. It is usually done to maintain and reach the required capital base as instituted by the central bank. A bank's capital base is the "cushion" for potential losses, that protects the bank's depositors and other lenders. It is the required amount set aside in assets to mitigate against losses.