Bank competition in Kenya
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Date
2018-05
Authors
Mdoe, Idi Jackson
Omolo, Jacob O.
Wawire, Nelson H.
Journal Title
Journal ISSN
Volume Title
Publisher
Springer Nature
Abstract
Abstract This study investigates the level of competition among commercial banks in Kenya
over the period 2001 to 2014. The study used a balanced panel data set from 36 commercial
banks, the performance dynamics approach and the generalized method of moments to estimate
the resulting dynamic panel models. The investigation established that the level of competition
among commercial banks in Kenya is low and characterized by 93.9 per percent persistence
in profitability. Arising from the study findings, it is important that the government
intervenes to rectify the intermediation inefficiency occasioned by ineffectiveness of competition.
It is also important that small sized banks in the sector voluntarily merge with other
smaller banks in order to exert substantial competition to the large and medium sized banks.
Description
Research Article
Keywords
Exceptional bank profitability, Profit persistence, Intermediation inefficiency
Citation
Journal of Industry, Competition and Trade, 2018