EVALUATION OF BANK PERFORMANCE MEASURES AND PROPOSES A COMMON MEASURE FOR COMMERCIAL BANKS IN THE EAST AFRICAN COMMUNITY (EAC) COUNTRIES

Authors

  • Dr. Rutto Peter Ketyenya Dedan Kimathi University of Technology

DOI:

https://doi.org/10.47941/ijf.157

Keywords:

Evaluation, bank performance measures, commercial banks in the East African Community (EAC) countries

Abstract

Purpose: The purpose of this study was to Evaluate bank performance measures and proposes a common measure for commercial banks in the East African Community (EAC) countries

 Methodology: The study used cross country data analysis of 100 commercial banks and collected secondary data from annual published audited financial statements for the period 1997-2011

Results: The results indicate that the OPM which combines productivity and profitability captured a high percentage of similar banks when the top 20 commercial banks were ranked; 80% for return on assets, 60% for profit margin and 55% for net interest margin.

Policy recommendation: The study recommended that OPM will enable central banks to assess the performance levels of banks and be able to detect those that are underperforming and take corrective measures to either improve productivity, profitability or both. For policy makers in the EAC secretariat, the measure will enable comparison on the performance of banks in East Africa for subsequent integration to the monetary union.

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Author Biography

Dr. Rutto Peter Ketyenya, Dedan Kimathi University of Technology

DOCTORATE STUDENT

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Published

2017-04-18

How to Cite

Ketyenya, D. . R. P. (2017). EVALUATION OF BANK PERFORMANCE MEASURES AND PROPOSES A COMMON MEASURE FOR COMMERCIAL BANKS IN THE EAST AFRICAN COMMUNITY (EAC) COUNTRIES. International Journal of Finance, 2(6), 60–74. https://doi.org/10.47941/ijf.157

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