CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The focus of this study is on the benefits that are derived from the use of information technology and corporate performance in banking industry. In the year past, activities in banking sector was done manually which resulted in unnecessary delays in generating required data and poor customer services. Consequently, the society preferred to keep their money inside their bedrooms. Being a sector of the economy whose services are universally demanded, the banking industry has for sometimes now been the target of criticisms as to the quality of services given to their customers especially as it relates to the time taken by most banks to carry out simple transactions. However, the Nigerian banking scene has witnessed phenomenal changes, especially since the mid 1980’s and these have manifested in the enormous volumes and complexity of operations increased innovation and variety in product/services delivery and business process re engineering. These developments have not only been driven by technological advances, but have also in turn spawned technological development. Information is one of the most frequently discussed issues in the field of banking. It is believed to be a major pre-requisite towards the attainment of banking goals and objectives.
However, it is often misunderstood and has become one of the greatest problems facing modem management. It is therefore true to say that information technology has been the hub of banking development since the last decades and will continue to be so, well into this 21st century With the recent upsurge in technology, especially the network computer system and telephone technology banking sector has become very dynamic in nature.More banks are acquiring the network system and this has brought about new innovations in banking sector examples are: Electronic Payment System Telephone Technology Global System of information banking (e.g. Flash me cash) Smart card Internet banking/online banking (i.e. bank anywhere cash anywhere) Pc banking-home banking With the introduction of the services mentioned, competition amongst banks is now so keen that banking generally focused their attention on changing from mechanical operations to computerized operations. However, a bank that is lacking in this focused change would not be able to stand the taste of time. Moreover, the use of computer and other system of information has again made the application of information technology and corporate performance to attain a high quality degree of e-security in the following arrears. Authentication: Securing the identification of the parties to the transaction. Confidentiality: Ensuring information is kept private Integrity: Ensuring the information process has not been modified or corrupted. Non-Repudiated: Ensuring that neither party can refuse that the transaction occurred i.e. (the transaction is binding) Therefore, the term “Information” came into limelight with the emergency of theories of banking especially the Weberian concept of bureaucracy which postulates information as a regulated norm and planned behaviour tailored towards the attainment of banking goals. A dictionary definition says that Information is a means of giving information. According to Shaw (2005) information is any progress whereby decisional premises are transmitted from one member to another. To strike at a working comprehensive definition, there must be the content, purpose and process as in that which says that, information is a transferring of thought or a message to another party so that such can be understood and acted upon. It is the transmitting of a signal (content) from one person (source) to another (receiver) who understands the signal and make appropriate response (feedback). Thus, it is a socially instituted process of sending messages (or a linking process), following one appropriate route (or a bearer) from one source to definite receiver with a view to getting feedback. Aremu (2003) stated that, any information passed down the banking structure is meant to elicit form of response which may get total or partial conformity, any or a show of indolence and passivity, and or in any banking when there is high degree of job satisfaction and enthusiastic understanding a clear feedback is assured. Hence the information flow overtime, rose from the traditional methods of giving orders and rigid instructions to workers who were considered ingenuous as rectors to modem participative initiative.
1.2 STATEMENT OF PROBLEM
The Nigerian banking industry smarting from the shock and losses of the distress syndrome that hit it hurricane recently is now gearing up for inevitable challenges of the 21st century. In this highly competitive environment, no bank can operate successfully without the use of modern technology. No matter the strategy employed, the
role of information technology for their day to day transactions for efficient customer service cannot be over emphasized Nigerian in banking sector.
1.3 OBJECTIVES OF THE STUDY
The study is aimed at bringing awareness of the information technology and corporate performance as it effects banking sector.
1. To identify the importance of information technology and corporate performance to banking sector.
2. To ascertain the relationship between information technology and corporate performance in banking sector.
3. To examine the effect information technology in relation to banking sector performance.
4. To determine the usefulness and empirical analysis of information technology in banking sector performance.