International Journal of Finance https://carijournals.org/journals/index.php/IJF <p>International Journal of Finance is a high factor peer reviewed journal published both online and printed version by CARI. The International Journal of Finance demonstrates that finance factors cooperation shows the increasing scope of various financial management strategies in recent past and corroborates the importance of international knowledge about finance. A double blind peer review process is employed as far as the peer review of the research paper is involved which contributes to a high quality publication. It can be regarded to be one of the top academic journal publishers in the sector of publishing of finance research.</p> CARI Journals Limited en-US International Journal of Finance 2520-0852 DUPLICITY IN REGULATION AND PERFORMANCE OF THE FINANCIAL SECTOR IN KENYA https://carijournals.org/journals/index.php/IJF/article/view/553 <p><strong><em>Purpose</em></strong>: The objective of the study was to investigate the duplicity in regulation and performance of the financial sector in Kenya. The specific objectives were; to review and identify regulation duplication/competition in existing regulatory framework for the financial sector in Kenya; to describe how regulatory effectiveness has been measured in empirical literature; to assess whether the current regulatory structure has affected the performance of the financial sector in Kenya and lastly to suggest potential ways of enhancing regulatory effectiveness in Kenya.</p> <p><strong><em>Methodology</em></strong>: The paper used a desk study review methodology where relevant empirical literature was reviewed to identify main themes and to extract knowledge gaps.</p> <p><strong><em>Findings</em></strong><em>: </em>The study found out that financial sector in Kenya and other developing economies have reported losses on a large scale due to under regulation and regulator duplicity. Some of these have become insolvent, or have had to be taken over or rescued by their governments. A single market regulator clearly has its own advantages over multiple regulators. But it is more suitable for well-developed and mature markets which are smaller in size, like the UK. The study also found out that Kenya’s economy and political arena are not mature enough to handle a single financial market regulator. In this light it can be asserted that even mature economies such as the United States still have multiple regulators.</p> <p><strong><em>Unique contribution to theory, practice and policy</em></strong>: Adherence to principles of open government, including transparency and participation in the regulatory process to ensure that regulation serves the public interest and is informed by the legitimate needs of those interested in and affected by regulation. Governments should ensure that regulations are comprehensible and clear and that parties can easily understand their rights and obligations. Organizations should create personalized technology systems that create a demand adaptation of ICT at every level of the organizational operations</p> Dr.Agnes Ogada Copyright (c) 2021 International Journal of Finance 2021-04-02 2021-04-02 6 1 39 53 10.47941/ijf.553 Futures trading and the underlying stock volatility: A case of the FTSE/JSE TOP 40 https://carijournals.org/journals/index.php/IJF/article/view/510 <p><strong><em>Purpose:</em></strong> This study analyzed the impact of listing and trading futures contracts on the underlying stock index volatility behavior. The FTSE/JSE TOP 40 index was the index of interest.</p><p><strong><em>Methodology:</em></strong> To capture the non-constant variance of the residuals, a modified Generalized Autoregressive Conditionally Heteroscedasticity (GARCH) model was adopted given that financial time series data exhibited ARCH effects. The GARCH model was estimated after dividing the sample period into pre-and post-futures eras.</p><p><strong><em>Findings:</em></strong> The research findings point towards stabilization effects on underlying stock volatility and refute the suggestion that futures markets<em> </em>improve the dissemination of information to the corresponding spot markets. On the same note, the introduction of futures increased the volatility persistence of index returns.</p><p><strong><em>Unique contribution to theory, policy, and practice: </em></strong>This paper applied a modified-GARCH by incorporating a dummy variable to the traditional GARCH model. The study used an emerging economy as a case study which makes the results and conclusions more specific and applicable. On the same note, the study covered the pre-and post-global crisis of 2007/8 in a Sub-Saharan nation. In practice, stock markets are encouraged to introduce futures contracts on highly volatile spot market assets.<strong><em></em></strong></p> Mr. Rabson Magweva Mrs. Magret Munyimi Mr. Justine Mbudaya Copyright (c) 2021 International Journal of Finance 2021-01-20 2021-01-20 6 1 1 16 10.47941/ijf.510 Effects of Selected Financial Management Practices on Financial Performance of Commercial Banks in Kenya https://carijournals.org/journals/index.php/IJF/article/view/517 <p><strong><em>Purpose:</em> </strong>The main aim of the study was to determine effects of selected financial management practices on financial performance of commercial banks in Kenya. The research was guided by the following specific objectives; to determine the influence of liquidity management, capital structure management, credit risk management and working capital management on the financial performance of commercial banks in Kenya.</p><p><strong><em>Methodology:</em> </strong>The research employed a descriptive research design. Census method of sampling was employed, all the 43 commercial banks formed the study units. Both primary and secondary data were used. Secondary data was obtained from the audited annual financial reports of the commercial banks in Kenya while primary data was collected using questionnaire which was designed in form of Likert scale. Descriptive and inferential statistics were used, whereby correlation and regression were used to establish the strength of the relationship between the financial management practices and financial performance of the commercial banks. Data was presented inform of tables, mean and standard deviation. Correlation analysis was performed to examine the relationship between the financial management practices and financial performance of the commercial banks.</p><p><strong><em>Results:</em> </strong>The study concludes that liquidity management had positive significant effect on the financial performance of commercial banks in Kenya. Measuring liquidity risk is important to making sure that liquidity problems are identified in time. The study concludes that capital structure management practice has positive significant effect on the financial performance of commercial banks in Kenya. On credit risk management practice, the research found strong positive significant on the financial performance of commercial banks in Kenya. Most of financial institutions have risk eliminating strategy in place, proper risk management. Finally, the study concludes that working capital management practice has positive significant on the financial performance of commercial banks in Kenya.</p><p><strong><em>Unique contribution to theory, policy and practice:</em> </strong>The research recommends that banks management should make sure that they maintain substantial levels of liquidity, so as to maintain competitive performance. Commercial institution must have a feasible capital structure in place that addresses issues such, as flexibility where changes in the capital market should be well adapted to the capital structure.</p> Faith Njeri Harrison Dr. Monica Muiru Copyright (c) 2021 International Journal of Finance 2021-02-05 2021-02-05 6 1 17 38 10.47941/ijf.517