Financial Sector Reforms and the Performance of the Nigerian Economy

Using descriptive statistics and Vector Autoregressive Model, we investigated theimpact of financial sector reforms on the performance of the Nigerian economy. The paperis justified given the need to provide empirical evidence on the effectiveness of financialreform in promoting saving, investment and growth. The paper found that the means ofperformance indicators - saving rate, investment ratio and growth of real GDP, were verylow relative to pre-reform period and their correlation with financial indicators were mostlylow or negative under reform. Evidence from the VAR analysis also showed that shocksto financial indicators either had negative or insignificant positive effect on the saving rateinvestment and growth during reform. Complementing financial reforms with structuralreforms, therefore, is necessary to promote growth in Nigeria.