Effects of Monetary Policy on Dividend Payout of Banks Listed Nairobi Securities Exchange
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Date
2021Author
Mohamed, Abdikadir M
Type
ThesisLanguage
enMetadata
Show full item recordAbstract
Monetary policies are paramount in shaping the economic well-being of any country. The
formulation of policies is strategically for the futuristic survival and sustainability of the business
and the economy. The main objective this study was to determine the effect of monetary policies
on the dividend payout. The shareholders have also expected for high dividend payout as an
indication that corporate governance is maximizing the shareholders’ wealth. The research utilized
secondary data from 2016-2019. The integral determinants were Repo Rate, Central Bank Rate,
and 91-Day Treasury Bill Rate. The theories anchoring this research were Liquidity preference
theory, pecking order theory and life cycle theory. The census was undertaken since all the
commercial banks listed in the NSE were studied. The quantitative descriptive research design was
integral method useful in this research. The SPSS was utilized to build the foundation of this
research. The research assessed and found out that the regressed variable was dividend payout and
correlated with the predictor variables such in Repo Rate, Central Bank Rate, and 91-Day Treasury
Bill by negative 49.6%, negative 2% and positive 79.6% respectively. The research indicated that
91-Day Treasury Bill was significantly correlated with dividend payout by 79.6%. The research
recommended for further consideration of macroeconomics factors since they were not exhaustive
in this study. The multicollinearity test was done using Variance Inflation Factors. The findings
postulated Repo rate with 1.538, Central Bank Rate 1.044 and 91-Day Treasury Bill at 1.558. This
eliminated the assumption that predictor variables were correlated. The multicollinearity was
within the normal range and insignificant. In a nutshell, the monetary policies have come of age
to transform the economy. The key builders must be addressed to enhance efficiency, effectiveness
and to promote economic growth.
Publisher
University of Nairobi
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Attribution-NonCommercial-NoDerivs 3.0 United StatesUsage Rights
http://creativecommons.org/licenses/by-nc-nd/3.0/us/Collections
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