Analysis of factors affecting institutional capital adequacy of Deposit-Taking Savings and Credit Cooperative Societies in Nairobi
Date
2019
Authors
Omingo, Vincent Ochieng’
Journal Title
Journal ISSN
Volume Title
Publisher
Strathmore University
Abstract
SACCOs Regulatory Authority (SASRA) capital adequacy requirements are key to Deposit-taking SACCOs' financial stability. The purpose of this study was to determine and analyze the factors affecting the attainment of institutional capital as prescribed by SASRA. More specifically, the study sought to investigate, the effect of the quality of the board of directors, management-staff competence, and dividend payout on the attainment of institutional capital adequacy, measured by institutional capital to total assets ratio. The population for the study was 40 Deposit-taking SACCOs that were registered, by SASRA, to operate in Nairobi County for the year 2017. A correlational study design was used to carry out a census. A structured questionnaire was used to collect data from the respondents who were the 40 Chief Executive Officers of DT-SACCOs. Both descriptive and inferential statistical methods were used to analyze data. Study findings indicated that Dividend payout, based on members' holding of non-withdrawable share capital, had the highest influence on the attainment of institutional capital adequacy of deposit-taking SACCOs Management-staff competence and quality of the board are second and third respectively, in the order of influencing the attainment of institutional. The study recommends that to counter the challenge of institutional capital inadequacy, under the influence of various factors, SASRA should consider developing a policy on institutional capital that includes members' Share Capital. This will reduce the burden of simultaneously attaining core capital and institutional capital adequacy.
Description
Submitted in partial fulfillment of the requirements for the award of Master of Business Administration (MBA) Degree