scholarly journals EFFECT OF MANAGEMENT EFFICIENCY ON FINANCIAL PERFORMANCE OF SAVINGS AND CREDIT SOCIETIES IN KENYA

2017 ◽  
Vol 2 (1) ◽  
pp. 92
Author(s):  
Jane J. Barus ◽  
Prof. Willy Muturi ◽  
Dr. Patrick Kibati ◽  
Dr Joel Koima
Keyword(s):  
Financial Performance ◽  
Significant Influence ◽  
Reliability And Validity ◽  
Target Population ◽  
Capital Adequacy ◽  
Unique Contribution ◽  
Linear Regression Models ◽  
Secondary Sources ◽  
Management Efficiency ◽  
Asset Quality

Purpose: The purpose of this study was to evaluate the effect of management efficiency on financial performance of savings and credit societies in Kenya.Methodology: The study employed an explanatory research design. The target population was 83 registered deposit taking SACCO’s in Kenya that have been in operation for the last five years. The sample size for the study was all 83 SACCOs that have remained in existence since 2011-2015. Census methodology was used in the study.  Both primary and secondary sources of data were employed.  Multiple linear regression models were used to analyze the data using statistical package for the social sciences (SPSS) and STATA. A pilot study was conducted to measure the research instruments reliability and validity. Descriptive and inferential analysis was conducted to analyze the data. The data was presented using tables and graphs.Results: Based on the findings the study concluded that management efficiency has no significant influence on the financial performance of savings and credit societies in Kenya. The univariate regression results showed that management efficiency has no significant influence on the financial performance of savings and credit societies (p=0.173).Unique contribution to theory, practice and policy: The study recommended that with regard to credit risk management, the management should undertake measures to improve Capital adequacy, Asset quality, Management efficiency, Earnings and Liquidity. Further, the study recommended that SACCO's should train their employees as this is likely to increase their productivity.

scholarly journals EFFECT OF ASSET QUALITY ON THE FINANCIAL PERFORMANCE OF SAVINGS AND CREDIT SOCIETIES IN KENYA

2017 ◽  
Vol 1 (4) ◽  
pp. 13 ◽  
Author(s):  
Jane J. Barus ◽  
Dr. Willy Muturi ◽  
Dr. Patrick Kibati ◽  
Dr Joel Koima
Keyword(s):  
Financial Performance ◽  
Reliability And Validity ◽  
Target Population ◽  
Linear Regression Models ◽  
Credit Policy ◽  
Equity Financing ◽  
Secondary Sources ◽  
The Social ◽  
Asset Quality ◽  
Credit Standards

Purpose: The purpose of this study was to establish the effect of asset quality on the financial performance of savings and credit societies in Kenya.Methodology: The study employed an explanatory research design. The target population was 83 registered deposit taking SACCO’s in Kenya that have been in operation for the last five years. The sample size for the study was all 83 SACCOs that have remained in existence since 2011-2015. Census methodology was used in the study.  Both primary and secondary sources of data were employed.  Multiple linear regression models were used to analyze the data using statistical package for the social sciences (SPSS) and STATA. A pilot study was conducted to measure the research instruments reliability and validity. Descriptive and inferential analysis was conducted to analyze the data. The data was presented using tables and graphs.Results: Based on the findings the study concluded that asset quality influenced the financial performance of savings and credit societies in Kenya. This can be explained by the regression results which showed that the influence was positive and also showed the magnitude by which asset quality influenced the financial performance of savings and credit societies. The univariate regression results showed that asset quality influenced the financial performance of savings and credit societies by 5.827units.Unique contribution to theory, practice and policy: The study recommended that management need to be cautious in setting up a credit policy that will not negatively affects profitability and also they need to know how credit policy affects the operation of their banks to ensure judicious utilization of deposits and maximization of profit. The study also recommended for credit information sharing between SACCO's. This will play a significant role in determining performance of deposit taking SACCO’s. Further, the study recommended that SACCO’s opt for equity financing instead of debt financing to improve on its leverage. SACCO’s should also avoid excessive lending, maintain high credit standards and limit lending to un-hedged borrowers.

scholarly journals Effect of Earnings Ability on Financial Performance of Savings and Credit Societies in Kenya

2017 ◽  
Vol 2 (5) ◽  
pp. 56
Author(s):  
Prof. Willy Muturi ◽  
Jane J. Barus ◽  
Dr. Patrick Kibati ◽  
Dr. Joel Koima
Keyword(s):  
Financial Performance ◽  
Reliability And Validity ◽  
Target Population ◽  
Legal Framework ◽  
Unique Contribution ◽  
Linear Regression Models ◽  
Secondary Sources ◽  
The Social ◽  
Institutional Capital ◽  
The Government

Purpose: The purpose of this study was to establish the effect of earnings ability on financial performance of savings and credit societies in Kenya. Methodology: The study employed an explanatory research design. The target population was 83 registered deposit taking SACCO’s in Kenya that have been in operation for the last five years. The sample size for the study was all 83 SACCOs that have remained in existence since 2011-2015. Census methodology was used in the study.  Both primary and secondary sources of data were employed.  Multiple linear regression models were used to analyze the data using statistical package for the social sciences (SPSS) and STATA. A pilot study was conducted to measure the research instruments reliability and validity. Descriptive and inferential analysis was conducted to analyze the data. The data was presented using tables and graphs. Results: Based on the findings the study concluded that earnings ability influenced the financial performance of savings and credit societies in Kenya. This can be explained by the regression results which showed that the influence was positive and also showed the magnitude by which earnings ability influenced the financial performance of savings and credit societies. The univariate regression results showed that earnings ability influenced the financial performance of savings and credit societies by 6.438units. Unique contribution to theory, practice and policy: The study recommended for continuous review of credit policies, establishment of irrecoverable loan provision policies, development of sound staff recruitment policies and the use of appropriate financing mix. Further, the Government should review legal framework to ensure that institutional capital is used to grow SACCO’s’ wealth.

scholarly journals EFFECT OF CAPITAL ADEQUACY ON THE FINANCIAL PERFORMANCE OF SAVINGS AND CREDIT SOCIETIES IN KENYA

2017 ◽  
Vol 1 (4) ◽  
pp. 1
Author(s):  
Jane J. Barus ◽  
Dr. Willy Muturi ◽  
Dr. Patrick Kibati ◽  
Dr Joel Koima
Keyword(s):  
Risk Management ◽  
Credit Risk ◽  
Financial Performance ◽  
Reliability And Validity ◽  
Target Population ◽  
Capital Adequacy ◽  
Operating Efficiency ◽  
Linear Regression Models ◽  
Credit Risk Management ◽  
Secondary Sources

Purpose: The purpose of this study to establish the effect of capital adequacy on the financial performance of savings and credit societies in Kenya.Methodology: The study employed an explanatory research design. The target population was 83 registered deposit taking SACCO’s in Kenya that have been in operation for the last five years. The sample size for the study was all 83 SACCOs that have remained in existence since 2011-2015. Census methodology was used in the study.  Both primary and secondary sources of data were employed.  Multiple linear regression models were used to analyze the data using statistical package for the social sciences (SPSS) and STATA. A pilot study was conducted to measure the research instruments reliability and validity. Descriptive and inferential analysis was conducted to analyze the data. The data was presented using tables and graphs.Results: Based on the findings the study concluded that capital adequacy influenced the financial performance of savings and credit societies in Kenya. This can be explained by the regression results which showed that the influence was positive and also showed the magnitude by which capital adequacy influenced the financial performance of savings and credit societies.Unique contribution to theory, practice and policy: Based on the findings the study recommended for improvement of the capital requirement regulations by SASRA. The study also recommended that SACCO should improve their liquidity, profitability, operating efficiency and total assets turnover if they must remain in business and meet the capitalization threshold SASRA. Further, the study recommended that SACCO's should shift their concentration from increasing capital levels to credit risk management. Credit risk management would result to improvement in the financial performance of SACCO's.

scholarly journals EFFECT OF LIQUIDITY ON FINANCIAL PERFORMANCE OF SAVINGS AND CREDIT SOCIETIES IN KENYA

2017 ◽  
Vol 2 (7) ◽  
pp. 34
Author(s):  
Jane J. Barus ◽  
Prof. Willy Muturi ◽  
Dr. Patrick Kibati ◽  
Dr Joel Koima
Keyword(s):  
Financial Performance ◽  
Regression Models ◽  
Reliability And Validity ◽  
Target Population ◽  
Linear Regression Models ◽  
Secondary Sources ◽  
Liability Management ◽  
The Social ◽  
Inferential Analysis ◽  
Professional Guidance

Purpose: The purpose of this study was to determine the effect of liquidity on financial performance of savings and credit societies in Kenya.Methodology: The study employed an explanatory research design. The target population was 83 registered deposit taking SACCO’s in Kenya that have been in operation for the last five years. The sample size for the study was all 83 SACCOs that have remained in existence since 2011-2015. Census methodology was used in the study.  Both primary and secondary sources of data were employed.  Multiple linear regression models were used to analyze the data using statistical package for the social sciences (SPSS) and STATA. A pilot study was conducted to measure the research instruments reliability and validity. Descriptive and inferential analysis was conducted to analyze the data. The data was presented using tables and graphs.Results: Based on the findings the study concluded that liquidity influenced the financial performance of savings and credit societies in Kenya. This can be explained by the regression results which showed that the influence was positive and also showed the magnitude by which liquidity influenced the financial performance of savings and credit societies. The regression results showed that liquidity influenced the financial performance of savings and credit societies by 0.019 units.Unique contribution to theory, practice and policy: The study recommended for the deployment of efficient systems to strengthen liquidity risk control fundamentals. SACCO’s should also consider seeking professional guidance towards adopting policies on asset and liability management.

scholarly journals FINANCIAL PERFORMANCE EVALUATION OF BANKS LISTED IN MUSCAT SECURITIES MARKET, OMAN: A CAMEL’S ANALYSIS MODEL APPROACH

2021 ◽  
pp. 135-145
Keyword(s):  
Financial Performance ◽  
Descriptive Analysis ◽  
Capital Adequacy ◽  
Securities Market ◽  
Analysis Model ◽  
Management Efficiency ◽  
Asset Quality ◽  
And Control ◽  
The Impact ◽  
Model Approach

The study is to examine the financial performance of banks listed in MSM, Omanthrough CAMEL model approach. The variables are computedusing financial ratios and compare them with established standards related to the Camel's standard to find out how important it is to implement a standard in the bank and ANOVA is calculated to determine whether results are meaningful. In other words, they help to determine whether you should reject the null hypothesis or accept the alternative hypothesis.The present research study uses descriptive analysis to achieve objectives of the study.The study's aim is to find out how CAMEL components affect the financial performance of MSM-listed banks. The findings support the impact of the CAMEL parameters on commercial bank results. Capital adequacy, asset quality, management efficiency, and liquidity are considered independent variables in the CAMEL model, whereas financial output is considered a dependent variable. All banks should follow and implanting perfect strategy in how used efficiency and effectively asset to generate profit. Moreover, monitoring credit risk of banks and control it.

scholarly journals Financial Performance of Bharat Co-Operative Bank – An Appraisal

2020 ◽  
Vol 8 (6) ◽  
pp. 571-576
Keyword(s):  
Performance Evaluation ◽  
Financial Performance ◽  
The State ◽  
Capital Adequacy ◽  
Earning Capacity ◽  
Management Efficiency ◽  
Time Period ◽  
Good State ◽  
Overall Evaluation ◽  
Asset Quality

Today, the lending sector is considered as the fastest rising sectors, also plenty of funds is been devoted in banks. Thus it involves so much of complexity and proper evaluation of its performance is needed. There are various models available for assessing the routine act of the bank. In this study we uses CAMEL model as an instrument to estimate the budgetary presentation of Bharat Cooperative bank. This model comprises of Capital Adequacy, Management Efficiency, Asset quality, Liquidity and Earnings. Bharat Cooperative bank has been selected for the time period of 2014-18 for studying and evaluating its financial performance. The study was conducted in accordance of the data collected from the yearly report of the respective in situation. Aiming the performance evaluation of the bank we have used 19 ratios related to CAMEL model. From the overall evaluation it was found that the state of capital adequacy was satisfactory. While considering Asset quality it was not up to the level, that is, it is not in a good state. The state of Management efficiency was also not up to the standard. The general earning capacity and the liquidity position were found favorable and satisfiable for the bank.

scholarly journals Financial Performance of Commercial Banks in Jordan: Application of the CAMELS Model

Prosperitas ◽  
2021 ◽  
Vol 8 (2) ◽  
pp. 1-9
Author(s):  
Saleh Jawarneh
Keyword(s):  
Financial Performance ◽  
Commercial Banks ◽  
Stock Exchange ◽  
Capital Adequacy ◽  
Basel Committee ◽  
Management Efficiency ◽  
Market Risks ◽  
Amman Stock Exchange ◽  
Earning Ability ◽  
Asset Quality

The study aims to analyse and rank the financial performance of Jordanian commercial banks using the elements of the CAMELS model. The study relies on a sample of 12 Jordanian commercial banks listed on the Amman Stock Exchange during the period 2016–2020. The study used variables included in the CAMELS model, namely: capital adequacy, asset quality, management efficiency, profitability, liquidity, and sensitivity to market risks. The research results indicate that Jordanian commercial banks enjoy high Capital Adequacy Ratios that exceed the minimum required by the Central Bank of Jordan and the Basel Committee. Jordanian banks have a strong sensitivity to market risks; therefore, they can control market risks and face any risk to which they may be exposed as well as the variety of the securities invested in these banks. Jordanian commercial banks are also characterized by a good earning ability. On the other hand, Jordanian commercial banks have a weak asset quality, and they also maintain weak and insufficient liquidity ratios to meet any unforeseen needs. These banks also show weak management efficacy, and this rating reflects weak management in expense controls.

scholarly journals Innovation approaches to estimate financial performance of banking sector: the case for Saudi Arabia

2021 ◽  
Vol 5 (2) ◽  
pp. 252-260
Author(s):  
Sanjeev Dhawan ◽  
Afroze Nazneen
Keyword(s):  
Performance Evaluation ◽  
Financial Performance ◽  
Banking Sector ◽  
Financial Structure ◽  
Capital Adequacy ◽  
Bank Performance ◽  
Management Efficiency ◽  
Earning Quality ◽  
Asset Quality

A robust financial structure is considered essential for the swift development and growth and of an economic system. The banking structure is a vital constituent of the financial structure of a nation. The banking system performance assessment is an influential determinant and indicator of the economy's financial strength. Financial Innovation approaches resulting from new technology helps in better estimation of Financial Performances of the banking sector. Banks need to be more closely and accurately watched as they play the role of facilitator of monetary policy of the economy. The prime objective is to examine the financial performance of Saudi Arabia's banking sector through Innovative approaches. With this view, a case study of XYZ Bank has been undertaken. For financial performance evaluation, the CAMEL model has been applied as one of the innovative approaches. This tool is a widely accepted criterion in the field of financial performance evaluation of the banking sector. CAMEL is a ratio-supported mechanism that evaluates bank performance through capital adequacy, quality of assets, management efficiency, quality of earnings, and liquidity. For analyzing the CAMEL model, the various ratios of the model in terms of proxy ratios are given below: For the analysis, nine-year data from 2009 to 2018 has been analyzed using a multiple linear regression model using the SPSS package. The study observed that this innovative approach, i.e., CAMEL specific factors, has mixed influence on the financial performance of XYZ Bank. Capital adequacy and asset quality have a positive effect on bank performance. Moreover, the study also highlights that management efficiency insignificantly affects the profitability of the bank. Moreover, earning quality also signifies a negative influence on profitability. The correlation between asset quality and ROA is negative. It is inferred that those banks with more operating profits and better liquidity management could report high profits. The study further advocates that XYZ Bank must improve its earning quality and management efficiency to come at the same level with the banks having good financial performance and should use innovative methods to estimate financial performance from time to time.

scholarly journals Bank Regulation and Level of Non performing Loans in Commercial Banks in Nakuru County Kenya

2020 ◽  
Vol 2 (2) ◽  
pp. 59-76
Author(s):  
Geoffrey Indeje Muhanji ◽  
Joseph Theuri
Keyword(s):  
Central Bank ◽  
Commercial Banks ◽  
Bank Regulation ◽  
Capital Adequacy ◽  
Liquidity Management ◽  
Macroeconomic Factors ◽  
Nonperforming Loans ◽  
Management Efficiency ◽  
Asset Quality ◽  
The Relationship

The study sought to determine the effect of bank regulation and level of nonperforming loans in commercial banks in Nakuru County Kenya. The specific objectives of the study were to explore the effect of capital adequacy on the level of nonperforming loans in commercial banks in Nakuru County Kenya, to find out the effect of asset quality on the level of nonperforming loans in commercial banks in Nakuru County Kenya, to evaluate the effect of liquidity management on the level of nonperforming loans in commercial banks in Nakuru County Kenya, to examine the effect of management efficiency on the level of nonperforming loans in commercial banks in Nakuru County Kenya and to determine the moderating effect of macroeconomic factors on the relationship between bank regulation and level of nonperforming loans. The literature review focused on portfolio theory of investment, capital asset pricing theory and the capital buffer theory of capital adequacy. The primary data was collected using structured questionnaires and secondary data was collected from the banking survey 2017 and central bank of Kenya annual supervisory reports. The study employed multiple linear regression analysis and the finding revealed that there exist a negative and statistically insignificant relationship between capital adequacy and non-performing loans. It was also observed that there exist a negative and statistically insignificant relationship between liquidity management and non-performing loans. On the other hand, there exist a positive and statistically significant relationship between asset quality and non-performing loans. Similarly, there exist a positive and statistically insignificant relationship between management efficiency and non-performing loans. Finally, the findings indicated that macroeconomic factors have moderating effect on the relationship between bank regulations and non-performing loans in commercial banks in Nakuru County. It was concluded that asset quality positively influences non-performing loans while management efficiency influence positively the non-performing loans. Similarly, liquidity management exerts a negative influence on non-performing loans. Finally, capital adequacy influence negatively on non-performing loans. The study recommends that Central Bank of Kenya should regularly access lending behavior to ensure compliance with banking regulations to avoid increasing incidences of non-performing loans. In addition, Central Bank of Kenya should closely monitor banks with deteriorating asset quality. Further, Central Bank of Kenya should strictly monitor the economic sector and ensure that banks provide adequate provisions for loans to mitigate risks of default. Furthermore, banks should maintain a good balance on deposits and lending out loans and adhere to regulators decisions about monetary policies. Finally, banks should increase the operational efficiency of operation weakness and improve corporate governance on the sanction of loans and Central Bank of Kenya should focus on managerial performance in order to detect banks with potential increases in non-performing loans.

Financial Performance Analysis of Nepalese Financial Institutions in the Framework of CAMEL

2020 ◽  
Vol 9 (1) ◽  
pp. 56-74
Author(s):  
Kedar Raj Gautam
Keyword(s):  
Financial Performance ◽  
Financial Institutions ◽  
Commercial Banks ◽  
Positive Relationship ◽  
Negative Relationship ◽  
Capital Adequacy ◽  
Significant Positive Relationship ◽  
Management Efficiency ◽  
Significant Negative Relationship ◽  
Development Banks

Analysis of financial performance to detect financial health of finance companies, development banks and commercial banks as a whole is a less explored research in Nepalese context. This paper, therefore, attempts to examine the financial performance and factors influencing financial performance of Nepalese financial depositary institutions in the framework of CAMEL. This study is based on descriptive cum casual research design. This study is based on secondary data which was extracted from various publications published by Nepal Rastra Bank such as banking and financial statistics, financial stability report and bank supervision report. All commercial banks, development banks, and finance companies are taken as population of the study. The study deals with financial performance analysis of entire population covering five years from 2014/15 to 2018/19. The variables such as capital adequacy, assets quality, management efficiency, earnings and liquidity are used to analyze financial performance. Descriptive as well as pooled regression analysis was used to assess the relationship among the variables. Descriptive analysis shows that financial institutions in each category meet NRB standard regarding capital adequacy. On the basis of capital adequacy and earnings, finance companies stand at first, on the basis of assets quality, development banks stand at first and on the basis of management efficiency, commercial banks stand at first. Finance companies store high liquidity as compared to other class financial institutions. The regression analysis shows that return on assets, ROA has significant positive relationship with capital adequacy and ROE but ROA has significant negative relationship with assets quality. However, return on equity, ROE has significant positive relationship with assets quality and ROA but ROE has significant negative relationship with capital adequacy. Capital adequacy and assets quality play major role to maximize ROA and ROE of financial institutions.

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