Effects of Strategy Diversification on Banks Performance

Only available on StudyMode
  • Topic: Bank, Retail banking, Marketing
  • Pages : 35 (9768 words )
  • Download(s) : 114
  • Published : October 30, 2012
Open Document
Text Preview
JOMO KENYATTA UNIVERSITY OF AGRICULTURE AND TECHNOLOGY.

FACULTY OF BUSINESS

EFFECTS OF STRATEGY DIVERSIFICATION ON PERFORMANCE OF BANKING INDUSTRY IN KENYA. (A CASE STUDY OF COMMERCIAL BANKS IN MOMBASA COUNTY).

By: CHRISTINE WANJIRU KAHIU
BCOMBA-008-0135/2009

A RESEARCH PROJECT SUBMITTED IN PARTIAL FULFILMENT FOR THE REQUIREMENT FOR THE AWARD OF A DEGREE IN BACHELOR OF COMMERCE AND BUSINESS ADMINSTRATION OF THE JOMO KENYATTA UNIVERSITYOF AGRICULTURE AND TECHNOLOGY. DECEMBER 2012

Declaration

This research project is my original work and has not been presented for a degree or for any academic use in any other university.

SIGNED: --------------------------------------DATE --------------------------------------------

Kahiu Christine Wanjiru

This research project has been submitted for examination with my approval as a University supervisor.

SIGNED: --------------------------------------DATE: --------------------------------------------

DEDICATION
To my family and friends

ACKNOWLEDGEMENT
I would like to acknowledge the following persons whose contributions facilitated the completion of this project. My special thank you goes to Mr. Martin Tubula for shaping the project idea into a meaningful form, and for his consistent and insightful reviews. Without his encouragement and patience, it would have been difficult to complete this project. Finally, I am indebted to all those who helped me write this project in one way or another especially my classmates and my friends, for their invaluable assistance in proof reading and critic of the paper throughout the stages.

To all of you wherever you are I say a big Thank You!

ABSTRACT
This study seeks to identify the impact of strategy diversificatio on performance of banking industry in Kenya. This is a descriptive survey of commercial banks in Mombasa County, Kenya. The population of this study is all the commercial banks, which had been operating in the county for at least five years. This study will be a census of all the 43 commercial banks that had been operating in Kenya. From these banks, a population of 12 banks will be selected. Primary data will be collected using questionnaires. The head of agency banking or his/her appointee in each of the selected commercial banks will fill in the questionnaires. The questionnaires will be entered into the SPSS after being sorted, coded, analyzed, and interpreted using descriptive statistics, and t-statistics. The results will be summarized in terms of the objectives of the study and presented in form of tables. The study will reveal that agency banking is prevalent within the banking industry in the county. But the most used strategy will confirm is the horizontal diversification followed by the geographical diversification. The study therefore will give a conclusion if or not that the banks are using agency banking or otherwise. On the benefits of agency banking, it will be noted that benefits includes greater income growth potential, improvement of the performance of distribution channels, risk control, acquisition of new technology, and change of business focus. The study will conclude that on a number of benefits of bank diversification available to commercial banks but improvement of core competencies/capabilities to gain significant benefits. The study will recommends that there is need for banks to diversify more in services to enjoy the enormous benefits of bank diversification. It will also recommend that commercial banks should consider more of customer segmentation and offer the products that can help improve the performance of such business segments. It may also be of interest of the banks to offer more of self-service products such mobile and online banking given that the internet connectivity has been upgraded in Kenya with the introduction of fiber optic cable. More studies need to be done in this area especially to unearth which type of...
tracking img