Loan Portfolio Quality Diversification Factor, Loan Syndication and Financial Performance of Commercial Banks in Kenya
Existing literature has demonstrated that loan syndication factors can affect banks performance. Good financial performance rewards the shareholders for their investment efforts and in turn, motivates them for additional investment and enables economic growth. On the other hand, underperformance can lead to banking failure and crisis which have negative repercussions on the economic growth. This study sought to determine the influence of loan syndication factor on the financial performance of commercial banks in Kenya. This study specific objective sought to determine the influence of loan portfolio quality diversification factor on the financial performance of commercial banks in Kenya To achieve the objective the study used descriptive survey design. A census of all 39 commercial banks that were in operation consistently was the object of the research. In each bank, a self-administered questionnaire was used to collect data from the 78 respondents who composed of credit directors and operation directors. A multiple regression analysis was run so as to determine the influence of loan syndication factors on the financial performance of commercial banks in Kenya. Theories anchoring this study included Modern intermediation theory, Modern portfolio theory, and Loanable fund theory. Data collected was analyzed using descriptive and inferential statistics. The study established that loan portfolio quality diversification had a significant statistical positive influence on the financial performance of commercial banks in Kenya. Recommendations included: banks' management to establish a special unit to take charge of loan portfolio management to deal with credit rationing in the bank. This study contributes to enhancing the existing knowledge gap on loan syndication and financial performance of commercial banks in Kenya
Year of publication: |
2020
|
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Authors: | Ongallo, Thomas Acholla |
Other Persons: | Gesami, Prof. Rachael (contributor) ; Mwaniki, Dr. Gillian (contributor) |
Publisher: |
[2020]: [S.l.] : SSRN |
Subject: | Kenia | Kenya | Bank | Kreditgeschäft | Bank lending | Portfolio-Management | Portfolio selection | Diversifikation | Diversification | Kredit | Credit |
Saved in:
freely available
Extent: | 1 Online-Ressource (8 p) |
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Type of publication: | Book / Working Paper |
Language: | English |
Notes: | In: American Based Research Journal, Vol. 8 Issue 05, May 2019 Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments May 1, 2019 erstellt |
Source: | ECONIS - Online Catalogue of the ZBW |
Persistent link: https://www.econbiz.de/10012835954
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