| dc.description.abstract | Sound financial health of a bank is the guarantee not only to its depositors but is equally
significant for the shareholders, employees and whole economy as well. As a sequel to this maxim, efforts have been made from time to time, to measure the financial position of each bank and manage it efficiently and effectively. The purpose of CAMELS ratings is to determine a bank’s overall condition and to identify its strengths and weaknesses in Financial, Operational and Managerial aspects. Despite the use of CAMEL Model by regulators to assess financial performance of banks, inefficiencies in performance have been experienced. some countries have shifted to other Models like EAGLES (Earning ability, Asset quality, Growth, Liquidity, Equity and Strategy)
This study was an explorative study. It focused on banks registered by the Central bank of
Kenya. Both primary and secondary data was be used; questionnaires and audited Financial statements. The study used statistical data analysis methods in addition to the use of computer softwares: SPSS and Microsoft Excel. The findings have been presented in the form of tables and scatter diagrams. From the findings of the study it was concluded that although CAMEL Model is used to measure financial performance of banks by regulators, no one factor in CAMEL Model is able to capture the wholistic efficiency of a bank. It can also be argued that no one CAMEL rating factor taken separately from the others can influence the financial performance of a bank. Therefore the CAMEL Model rating factors should be considered together as a combination and are inter-related . | en |
