Effect of leverage and firm size on financial performance of deposit taking savings and credit cooperatives in Kenya

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ID: 91398
2019
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Abstract
Critical to the success of financial institutions' performance is there Capital Structure. The study aimed to, investigate the effect of two capital structure determinants, leverage, and firm size on financial performance as measured by Return on Assets of Deposit Taking Savings and Credit Cooperative Societies in Kenya. The study was grounded on Tradeoff, Pecking order, and Mogdiliani and Miller capital structure theories. A positivist approach was adopted utilizing a mixed-method research design. The population of the research study was 174 Deposit Taking Savings and Credit Cooperative Societies from whom primary and secondary data was collected. A stratified and purposive sampling technique was employed. Descriptive statistics and a regression model were used to analyze the data. The results revealed that firm size had a significant and positive effect on financial performance, whereas Leverage, had a significant but negative effect on financial performance. The study recommends having in place an Assets and Liabilities committee in each Deposit Taking Savings and Credit Cooperative Society that would help manage the assets and liabilities of the institution, ensuring sound liquidity and cash flow management. Critical factors that contribute to a firm size such as increased membership, deposits mobilization amongst others need to be addressed.
Reference Key
shibutse2019effectinternational Use this key to autocite in the manuscript while using SciMatic Manuscript Manager or Thesis Manager
Authors Shibutse, Robert lukhanda;Kalunda, Elizabeth;Achoki, George;
Journal international journal of research in business and social science
Year 2019
DOI
DOI not found
URL
https://www.ssbfnet.com/ojs/index.php/ijrbs/article/view/462
Keywords
Technology environmental sciences business economics as a science finance social sciences economic theory. demography economic growth, development, planning geography. anthropology. recreation environmental technology. sanitary engineering banking

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