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dc.contributor.advisorRobert Mugoen_US
dc.contributor.authorKirui, Ronald Kipngeno
dc.date.accessioned2023-08-10T10:06:27Z
dc.date.available2023-08-10T10:06:27Z
dc.date.issued2023
dc.identifier.urihttp://ir-library.ku.ac.ke/handle/123456789/26750
dc.descriptionA Research Project Submitted to the School of Business, Economics and Tourism in Partial Fulfillment for the Award of Degree of Masters of Business Administration (Finance), Kenyatta University May, 2023en_US
dc.description.abstractThe banking industry in Kenya is one of the most developed in East Africa and has great potential in this field. Commercial banks play a crucial part in improving the transition of credit from surplus to deficit, thus promoting local economic activities. However, in recent times, banks have found that customers' credit efficiency has decreased, late payments, or bad debts has affected the bank's profits. Bad loans from commercial banks in Kenya continue to erode banks' profitability, hampering the financial performance of the industry. Notably, the non- performance of these loans led to the acquisition of the National Bank of Kenya by KCB Group Plc, which is indicative of the severity of bad loans in the Kenyan banking sector. The alarming rate of bank failures has raised serious concerns among stakeholders inside and outside the banking industry in Kenya as it affects the history of commercial banks, borrowing performance has damaged the reputation of the industry and thus reduced results. In light of this background, the aim of this study was to ascertain the impact of business characteristics on the lending practices of commercial banks in Kenya. Its specific objective is to study the impact of management efficiency, capital adequacy, credit volume and bank size on the credit performance of commercial banks in Kenya. Efficiency structure theory, time capital theory, and information asymmetry theory formed the basis of the research. An illustrative study design was applied to the study covering 39 commercial banks from 2015 to 2021. The data came from secondary data sources, primarily using data mapping instructions. The data was evaluated utilizing inferential and descriptive statistics. Descriptive evaluation included means and standard variations while inferential assessment was done using regression table. A significance level of 0.05 was used to guide hypothesis testing. Several diagnostic tests were used, including stability test, multicollinearity, heteroscedasticity and Hausman test. The principles of ethical review shall be duly followed. The outcome of the investigation as demonstrated by the survey revealed that management efficiency insignificantly but positively affects loan performance; capital adequacy inversely affected the commercial banks’ loan performance however, in a manner the is significant; credit size was shown to have a detrimental and negligible impact on the performance of commercial banks' loans; while the outcome showed that bank size directly and positively affected Kenyan commercial banks’ loan performance in a manner that is irrelevant. The investigation recommends that the management of the commercial banks should employ better ways of managing their loans. This can be done through the use of assessing central information of the bank customers to determine customers’ credibility in Kenya.en_US
dc.description.sponsorshipKenyatta Universityen_US
dc.language.isoenen_US
dc.publisherKenyatta Universityen_US
dc.subjectFirm Characteristicsen_US
dc.subjectLoan Performanceen_US
dc.subjectCommercial Banksen_US
dc.subjectKenyaen_US
dc.titleFirm Characteristics and Loan Performance of Commercial Banks in Kenyaen_US
dc.typeThesisen_US


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