Impact of income and geographical diversification on the the financial performance of Commercial Banks in Kenya

Simple item page
dc.contributor.authorWanjiru, Kwena Frida
dc.date.accessioned2016-03-22T07:31:53Z
dc.date.available2016-03-22T07:31:53Z
dc.date.issued2015-11
dc.descriptionSubmitted in partial fulfillment of the requirements for the Degree of Bachelor of Business Science in Financial Economics at Strathmore Universityen_US
dc.description.abstractSo as to better withstand the rapid revolution in the banking sector, characterized by incessant changes in technology, liberalization and stiff competition, commercial banks have resorted to diversifying away from traditional lending activities into new risker areas alongside employing newer distribution channels. The current study analyses the impact of this income and geographical diversification on the financial performance of forty commercial banks in Kenya between 2008 and 20 I 4. Fixed effects and random effects panel analysis frameworks are employed to this end. Performance is measured as Return on' Asset (ROA) and Return on Hirschman Index (Hl-11). The study finds a negative relationship between both income and geographical diversification when ROA is used as a measure of performance, indicating no benefit in diversification. However, using ROE as a measure of performance reveals a positive relationship between both income and geographical diversification and firm performance. The mixed results could be attributed to the fact that net interest income, non-interest income and profit moderately moved together over the period of this study which indicates that they responded to the same economic shocks in a similar manner. In addition, the Kenyan banking industry is dominated by a few large banks with small and medium banks recording dismal ROA despite the increasing diversification efforts. Growth of these bank could significantly improve the results as ROA would improve hence aiding commercial banks to reap the benefits of diversification.en_US
dc.identifier.urihttp://hdl.handle.net/11071/4349
dc.language.isoenen_US
dc.publisherStrathmore Universityen_US
dc.subjectBank performanceen_US
dc.subjectGeographical performanceen_US
dc.subjectIncome diversificationen_US
dc.titleImpact of income and geographical diversification on the the financial performance of Commercial Banks in Kenyaen_US
dc.typeOtheren_US
Files
Original bundle
Now showing 1 - 1 of 1
Thumbnail Image
Name:
Impact of income and geographical diversification on the the financial performance of Commercial Banks in Kenya.pdf
Size:
5.18 MB
Format:
Adobe Portable Document Format
Description:
Full - text undergraduate research project
Download
License bundle
Now showing 1 - 1 of 1
Thumbnail Image
Name:
license.txt
Size:
1.71 KB
Format:
Item-specific license agreed upon to submission
Description:
Download
Collections
BBSE Research projects (2016)