The study examined the effect of money supply on the performance of banking sector in Nigeria. The study employed secondary data extracted from the Central Bank of Nigeria (CBN) statistical bulletin of 2019 and the World Bank development indicators. The ordinary least square (OLS) multiple regression technique was employed as the method of data analysis and covered a time period of thirty two years (1988- 2019). The result indicated that money supply has a negative and statistically significant impact on the performance of the banking sector. A major recommendation of the study is that, the fiscal policy should be employed in order to provide conducive environment for the banking sector to strife by reducing the corporate taxes paid by banks.