Microfinance institutions and economic growth in Tanzania: a case study of Chunya District, Mbeya
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Date
2015-05
Authors
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Publisher
Kampala International University.College of Economics and Management
Abstract
The study was set to establish the impact of debt management on financial performance of
commercial banks in Uganda. A case of centenary bank, Uganda Kabalagala branch. It was
guided by the following objectives; to find out the different debt management strategies used by
commercial banks, to examine the financial performance levels of commercial banks, and lastly
to assess the relationship between debt management and financial performance in commercial
banks. The study adopted a descriptive research design. The design is deemed appropriate
because the main interest of the researcher is to explore the viable relationship and describing
how the factors support the two variables that are under investigation. The researcher will collect
data using administering questionnaires and interviews to obtain up-to- date and first hand
information. The study uses a study population of 71 members representing beneficiaries from
Centenary bank, staff members of Centenary Bank in Kampala. From this population a sample
size of 60 respondents was got using sloven's formula. The study made the following findings
The research on debt management and financial performance of commercial banks in Uganda
was conducted in Centenary's bank Kampala branch. On examining the techniques of debt
management employed by Centenary bank, the findings revealed that; determination of payment
period, debt consolidation, debt cycling, security and safety of the advance, efficiency of
management and liquidity level were the responses given by the respondents. The findings
conclude that there is a high degree of financial performance levels of commercial banks and if
this is maintained, it will constitute to the satisfaction of the financial performance of the
commercial banks. According to the findings, the factors affecting debt management were
regressed on factors under financial performance of commercial banks. The findings revealed
that factors studied under debt management explain 74.7% of the factors leading to financial
performance of commercial banks. The correlation coefficient 0.864 is strong and showed that
debt management has a significant strong relationship on financial management in commercial
banks. The study made the following conclusions According to the analysis made Centenary's
bank ensures that the credit and debt collection staff work as a team, excellent liaison and
communication skills especially when identifying business risks and how to minimize bad
debts. Centenary debt terms are effective since are set jointly by board members, Heads of
departments and managing director. The study confirmed a strong positive relationship between
debt management and financial performance in Centenary bank. The existence of an effective
debt policy, the higher the financial performance levels. The study made the following
recommendations The procedures in the previous chapter have laid a firm foundation
upon which recommendations can be drawn from the study in light of the study objectives.
Management of Centenary bank should ensure that the credit and debt management/collection
staff work as a team, excellent liaison and communication skills especially when identifying
business risks and how to minimize bad debts and provision for doubtful debts as well.
Description
Research report submitted to the College of Economics and Management Sciences in partial fulfillment of the requirements of the award of a bachelor's degree in Business Administration of Kampala International University
Keywords
Microfinance, Institutions, Economic, Growth