Moderating Effect of Gross Domestic Product on the Relationship between Camel Rating Model and Financial Performance of Deposit Taking Savings and Credit Cooperative Societies in Kenya
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Date
2024-01
Authors
Mirichii, John Mwaniki
Malgit, Amos Akims
Mbugua, Levi
Nyachae, Samuel Moragia
Journal Title
Journal ISSN
Volume Title
Publisher
JEMT
Abstract
The study sought to establish the moderating effect of gross domestic product on the relationship
between CAMEL rating model and financial performance of Deposit Taking SACCOs in Kenya. The
study originates from the Doctoral dissertation of the first author in which the co-authors served as supervisors. Capital buffer theory and stewardship theories were utilized in supporting the nexus
between the variables of the study. Secondary data was collected for the period 2013 to 2022 and
panel regression analysis was applied. The study established that the nexus between CAMEL
rating model and financial performance in the context of deposit taking SACCOs in Kenya is
significantly predicted by gross domestic product. It was consequently concluded that the aggregate
of economic growth as reflected by gross domestic product plays a significant role on CAMEL rating
model and financial performance nexus with respect to deposit taking SACCOs in Kenya. The study
recommends that the Government of Kenya should ensure economic growth in the country. The
Government should stimulate economic activities through government policies and activities (of
patronizing different sectors). Profits generated by SACCOs during economic expansion should be
adequate reinvested into financial intermediation activities as well as other investment opportunities
for purposes of diversification.
Description
Article
Keywords
Camel rating model, capital buffer theory, stewardship theory, gross domestic product, financial performance
Citation
Mirichii, J. M., Akims, M. A., Mbugua, L., & Nyachae, S. M. (2024). Moderating Effect of Gross Domestic Product on the Relationship between Camel Rating Model and Financial Performance of Deposit Taking Savings and Credit Cooperative Societies in Kenya. Journal of Economics, Management and Trade, 30(1), 19-28.