School of Business
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Item Effect of Internal Factors on Financial Performance Of Banks Listed at the Nairobi Securities Exchange(KCA University, 2017) Mananda, Jones J.O.This study seeks to establish the effect of internal factors on financial performance of banks listed at the Nairobi securities Exchange in Kenya. The study focussed on all 11 banks that are listed at the Nairobi securities exchange over 8-year period from year 2009 to year 2016. The study used panel data regression model to analyse the panel data. The researcher carried out various diagnostic tests to rule out the problems of autocorrelation, multicollinearity and heteroscedasticity. Hausman test revealed that random effects model was to be used in this study. The study findings indicate that management efficiency is significant and is positively correlated with return on assets while earnings ability is positively related but insignificant. Capital adequacy, Asset quality and liquidity were found to be insignificant and negatively related to return on assets. Management efficiency and earnings ability which are both positively correlated to performance of commercial banks should be given adequate attention in terms of resource provision and monitoring. By doing so performance of banks listed at the Nairobi Securities Exchange shall improve and this will attract more investors in the Securities market and ultimate growth in the economy as there will be a multiplier effect. The finding of this study agrees with some of the previous researchers and differs with other researchers.Item Determinants Of Financial Inclusion In East Africa(KCA University, 2018) Wokabi, Victoria W.There is a growing focus on financial inclusion among scholars and in policy circles. This study sought to analyse the underlying determinants of financial inclusion among five East African countries- Kenya, Uganda, Tanzania, Rwanda and Burundi. The general objective of the study was to determine the determinants of financial inclusion in East Africa. Specifically, the study examined the effect of rural population size, unemployment rates, income level and interest rates on financial inclusion. Rural population was presented as the proportion of a country’s population that lives in rural areas, unemployment rate as the proportion of a country’s population that is unemployed; income as the annual growth rate in GDP per capita; and interest rate as the real interest rate per year. The study used domestic credit to private sector by banks as a measure of financial inclusion. This variable is representative of the usage dimension of financial inclusion. The research design used was panel data analysis with secondary data collected from the World Development Indicators database of the World Bank. The 17 year period covered by the study spanned 2000 to 2016. The data was analyzed on Stata and the output from analysis provided a basis for findings and recommendations. After conducting diagnostic tests, the model adopted for the study was the fixed effects model. The study found that rural population and income are significant determinants of financial inclusion with rural population being negatively related with financial inclusion. This means that the higher the rural population of a country, the less inclusive their financial system is. Unemployment though statistically insignificant had a negative relationship with financial inclusion. Interest rates had a positive but insignificant relationship with financial inclusion. The study recommended that focused financial literacy efforts be increased in the rural areas within East Africa to promote inclusion efforts. Areas for further study as recommended by the study were that a more robust measure of financial inclusion be used as opposed to the one-dimension measure adopted for this study. Further, the study recommended the use of more variables beyond the four to achieve more representative determinants of financial inclusion.Item Determinants Of the Capital Structure of Companies Listed on The Nairobi Securities Exchange(KCA University, 2015) Muhumed, Shakir H.The increasing trend of abrupt corporate failures both locally and globally are incensing growing concern among shareholders and other stakeholders alike. This has made these stakeholders to question the performance of their firms. Capital structure is arguably the core of modern corporate finance. This study sought to examine the determinants of capital structure of firms listed on the NSE. While the specific objectives were: To determine the effect of profitability on capital structure for companies listed in NSE, to establish the effect of growth opportunity on capital structure for companies listed in NSE, to establish the effect of firm size on capital structure for companies listed in NSE, to evaluate the effect of firm age on capital structure for companies listed in NSE, and to evaluate the effect of asset tangibility on capital structure for companies listed in NSE. The study reviewed trade off, pecking order and Modigliani and Miller theories that underpinned the study. Longitudinal research design was used. The study was a census study of all the firms listed in the NSE between 2003 and 2013. Secondary data from certified financial records of the firms was extracted and both descriptive and inferential statistics used. The data was both cross sectional and time series in nature and therefore panel data model was used. The study results established that firm profitability, growth opportunity, firm size, firm age and asset tangibility all had no significant effect on total debt of firms listed in NSE in Kenya. In regard to equity levels, the study established that profitability and asset tangibility have a significant effect on equity to total assets ratio. However, the study reveals that that firm size, firm age and growth opportunity have no significant influence on equity to assets ratio. From the study results, recommendations were made to managers of firms to observe present and future profitability of their firms as it is deemed as a major determining factor in capital structure and hence in determining the cost of capital and value of the firm. Further managers should also ensure that they effectively manage their assets to enable the firm’s assets to remain of high quality so as to contribute in the firm’s earning power.