The financial system in any modern economy consists basically of two markets via:
1} The money market
2} The capital market
The money market provides short term finances for project execution, while the capital market perform all the long term functions of buying, selling and borrowing of long term funds.
The capital market is a highly specialized and organized financial market and indeed essential agent of economic growth because of its ability to facilitate and mobilize saving and investment. To a great extent, the positive relationship between capital accumulation and economic growth has long been affirmed in economic theories (Anganwu 1993).
Success in capital accumulation and mobilization for development varies among nations, but is largely dependent on domestic savings and inflows of foreign capital therefore, to arrest the menace of the current economic downturn, effort must be geared towards effective resources mobilization. It is in realization of this, consideration is given to the measure for the development of capital market as an institution for the mobilization of finance from the surplus sector to the deficit sector. The development in the capital market in Nigeria, as in other developing countries has been induced by the government though prior to establishment of stock.