Corporate Governance And Financial Performance Of Commercial Banks In Kenya

Abstract

The focus of this study is to examine the Governance factors that have impact on the financial performance of banks in Kenya. The aim of the study is to determine the governance policies used by banks in Kenya and the resulting impacts on the financial performance of banks. A cross-sectional analysis style was applied during this study. The population concerned during this study was all the forty-two banks in Kenya. A study was carried out on the forty-two financial institutions that were accredited and operational in Kenya as at thirteenth August, 2016.Primary knowledge were obtained by administering questionnaires to CEOs of the forty-two banks. Content validity of the instrument of information assortment was assured by making certain that every of the items within the form addressed specific contents and objectives of the study. SPSS was accustomed run multiple correlations Analysis to see the magnitude of the link and prediction of monetary performance severally. It was absolutely realized that company governance plays a vital role on monetary performance. From the findings, company governance factors such as Corporate Governance Policies and Rights of Shareholders account for sixty-one percent of the governance factors affecting the performance of banks. Conclusions drawn were that the manner an entity is governed has a great impact on the returns of the entity and commercial banks will flourish if their stakeholders concern are prioritized. They should therefore deploy appropriate governance structures, risk control systems and be transparent in their dealings.