AN EXAMINATION OF TREASURY MANAGEMENT PROCEDURES AND THEIR IMPLICATION ON BANK PERFORMANCE

In recent times, many Nigerians are living witnesses to the spate of failures, fraud and distress in the banking industry. On the other hand, it is not far from the truth to staff that some banks in the country have been able to forge ahead and keep their head above waters inspite of the economic predicament planging the nation. Studies have shown that the success ad failures of most modern business organisation (especially in Nigeria) hinges on the ability of those at the helm of affairs in these organisation to apply successfully the concepts of management. However, events have proved that organisations such as bank needs more than ordinary management. There is the unavailable need for the bank to apply the concepts of treasury management.
According to Okeya (2017) treasury management deals with the ability to plan, mobilize, monitor and manage liquid financial resources. He went further to explain that such managemen will not only reduce the risk of loss but will go a long way to increasing net earnings in a manner that is consistent with the strategic objectuves of the organization. However, it could be considered imperative at this juncture to ask why it is important for bank to appreciate the concept of treasury management and the objective to be achieved through treasury management.
In the opinion of Akin-Ajayi (2013) the importance of treasury management to the banking industry cannot over emphasized and the objectives of the treasury management includes among other things to help a bank to maintain the ability to pay availability of fund at the right times in the right place. In the right currencies and at an acceptable cost to minimize idle balances, and over all to ensures that adequate funds are available to the banks to service the needs of the bank and to meet the C.B.N liquidity and reserve requirement.
A look at the above view shows that in this contemporary times, no bank can fully achieve a reasonable degree of success without resource to the concept of treasury management. However, the question then is, how far has Nigeria banking industry been able to imbibe this concepts in their operations? And to what extent can managing its treasury very well enhance the liquidity position of a bank. It is as a result of the above that this study intends to critically examine the issue of treasury management and their implication on banks performance with special reference to the United Bank for Africa (UBA)0000000 plc.
Commercial Bank assets management is a never ending tug of war, this war is pitched between efficient liquidity management on the hand and profitability on the other. Over the years, the organic growth in financial markets and the spread of liability management have resulted in a greater diversity in banks liabilities and assets and the result in increased risk exposure through maturity mismatches. This has had adverse implication on banks incomes and liquidity to the extent that the needs to minimize or avoid such and other associated risks has called for a system approach for banks fund management.
A series of techniques ae brought to bear where holdings of reminerative assets are financed by related liabilities on one hand and on the other, liabilities may be accepted in advance of committment. The later are subsequently deployed in accquiring the former. Its main strenght lies in the ability to systematize and incorporated the other approaches which employing management experience in decision making. Furthermore, the key areas that impinage on profitability such as gap management liquidity, cost control etc are identified. This has the over-all objectives of taking decision consistent with the over-all onjectives of profit maximization within the constraints of liquidity, solvency are regulartory requirements, it has been noted that the last decade brought with it a different economic environment, this emerged with the debt crisis and the serious payment difficulties experienced by the developing debtors economics.
Bank assets has to be reclassified with a roll back in international lending to developing countries. There were increased maturity mis-matches and risk including country risk. All these resulted in securitization and increase of balance sheet business in this way, bank were able to expand their business and earn fee incomes without increasing balance sheet footings. This cannot be more relevant in any economy than Nigeria today where the economy has been heavily deregulated and the debts crisis is still far from surmantable. However, a modern day treasurer is concerned with the totality of banks fund management, however, the recent spate of distress fraunds, faiures and the abysmal performance of bank compets one to ask how far to what extent does the Nigeria banks appreciate the concepts of managing their treasury. It is as a result of the above that this study intend to take a critical look at the issues of an examination of treasury management procedures and their implication on banks performance.
Studies have shown that the success of any organisation is largely dependent on the extent to which both the human and materials resources are managed.
Howevr, banks deserve more than ordinary management, in any case, the general objectives of treasury mangement are to play mobilize monitor and manage liqude. Financial resources because such management increase net earning in a manner that is consisten with the strategic objectives of the organisation. Therefore the objective ot this study are aimed at:-
a. To examine the ways banks maintains the ability to pay obligation as they becomes due.
b. How do Nigeria banks manage their specified liqiud assets so as to maximizing returns to the banks
c. What aere the problems that empede on the ability of the banks to manage their treasury.
d. To what extent do the banks ensures the adequacy of funds in order to meet the CBN liquidity requirements and also to service the needs of the bank.
e. To identify how banks ensures the availability of funds at the right time, in the right place in the right currencies and at an acceptable cost.
f. What are the possible solution or suggestion through which these problems could be alleviated
In pursuance of the research work the researcher considered it necessary to pose some research question. This will enable us to achive the objectivs of this study. Consequently., these research question are formulated base on the objective of this study, sequest to this possing the following research questions becomes an iressable imperative.
(a) In what ways do banks manage their ability to pay obligation as they becomes due?
(b) How do the Nigerian bank manged their liquid assets so as to maximise returns to the bank.
(c) What re the prblems that impede on the ability of the bank to manage their treasury?
(d) To what extent do the banks ensured the adequacy of funds in order to meet the CBN liquidityrequirements and also service the needs of the bank?
(e) How do the banks ensure that availabiity of funds especially at the right time, the right place, in the right currency at acceptance cost?
(f) What are the possible solution or suggestins through which these problems could be alleviated?
Ho: Treasury management is not one of the ways banks can maintain their ability to pay oblation as they becomes due.
Hi: Treasury management is one of the ways banks can maintain their abiity to pay obligation as they becomes due.
Ho: Efficient management of banks liquid assets does not increase their return (profitability).
Hi:Efficient management of banks liquid assets increases their return (profitability).
Ho:Efficient management of banks liquid assets increases their return (profibility).
Ho: Poor management team is not the major problem that impede on the ability of the bank to manage their treasury.
Hi:Poor management team is the major problem that impede on the ability of the bank to manage their treasury.
Finally, this study is very significant because the researcher si of the opinon that it will be a contribution to the theory of acdemic development of the theories of treasury management and for this reason will serve as a springboard for other fellow students ressearchers especially those who may wish to research further on the subject matter in future.
In undertaking this study, the researcher considered it necessary to work on the following hypothesis;
Hi: The ability of the bank to meet its liquidity needs depends to  a large extent on the bank treasury management procedures.
Ho:The number of depositors in a bank does not have any positive impact on the banks cash flows.
Hi: The number of depositors in a bank have a lot of positve impact on the banks’s cash flow.
Ho:The length of time which it take a bank to recover it loans has no
significant effect on the bank’s profit potentials.
Hi: The length of time which it takes a bank to recover its loans has
significant effects on the bank’s profit potential.
The importance of treasury management to the success of the banking industry cannot be overemphasized. Since not much has been written on this topic, this study is therefore very significant because it will enables the researcher to outline some of the basic concepts of treasury management so that most banks in the country can benefit from it. This study is also very significant because through it. The reseacher will unevil or disclose to the banking industry the need for efficient treasury management so as to enable them minimize idle balances. Also, this study is very significant because through the findin and the subsequent recommendation both the banking and non-bank finical institutions will appreciate the relevance of treasury management.
The following definitions of terms represent the specific meaning(s) that will be given to them in this study.  These terms are:
MANAGEMENT: In this study, management denotes the process of utilizing the resources of an organization to accomplish set objectives.
ORGANISATION: This denotes a social system of an organized body of persons working together to achieve a common purpose.
LIQUIDITY: This denotes the ability of banks to pay cash immediately when called upon to do so far all its demand liabilities.
PORTFOLIO: In this context, portfolio denotes that list of securities and investment loans stock and shares bonds etc held (own) by a bank, individual or organization.
TREASURY BILL: Treasury bills are investment issued to raise finance for the federal government.
SOLVENCY: In this study, the solvency of a bank is measured by its ability to turn its assets into cash to meet its deposit obligation