ABSTRACT
The study examined the evolution of financial sector reforms in Africa. Specifically, it investigated the timing, sequence, and the effects of the reforms on the performance of the African financial sector. To achieve this objective, the study assessed the financial sector policies and development before, during, and the post-liberalization periods. It was deduced from the findings of the study that despite the financial sector reforms, the sector performed below expectation as the problem of low efficiency, low liquidity, and less capital and sensitive institutional problem noticed in the sector before liberalization persisted. Reasons adduced to this include management failures to evaluate and control risk-taking in the financial institution, institutional weaknesses, extent of integration into the world economy, and weak capital regulation and supervision. The study concluded that liberalization of the financial sector is a necessary but not sufficient condition for the development of the financial sector. It recommended that for the continent to reap the benefits of liberalization, the macroeconomic environment must be stable and that subsequent reforms must consider the socio-economic settings of the region.
