Return on Assets Efficiency of Kenyan Banking Sector

Isaiah Onsarigo Miencha (), Murugesan Selvam and Seline Anne Onchangu
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Isaiah Onsarigo Miencha: Department of Banking and Finance, All Nations University, Ghana
Murugesan Selvam: Department of Commerce and Financial Studies, Bharathidasan University, India
Seline Anne Onchangu: Department of Management Studies, Kisii University, Kenya

Journal of Internet Banking and Commerce, 2016, vol. 21, issue 02, 01-17

Abstract: This paper empirically predicts the Return on Assets (ROA) efficiency of sample banks by using the Data Envelopment Analysis. A sample of 18 banks was taken for the study. The sample banks were categorized into three main groups’ i.e. large size group, medium size group and small size group. The main objective of this study was to analyze the technical efficiency (in respect of return on asset) of sample Kenyan banks, namely, Kenya Commercial Bank Ltd, Standard Chartered Bank Ltd, Barclays bank of Kenya Ltd, Co-operative Bank of Kenya Ltd, CFC Stanbic Bank Ltd, Equity Bank Ltd, Bank of India Ltd, Bank of Baroda Ltd, Commercial Bank of Africa Ltd, National Industrial Development Bank of Kenya Ltd, I & M Bank Ltd, Diamond Trust Bank (K) Ltd, Habib Bank Ltd, Oriental Commercial Bank Ltd, Habib Bank A.G. Zurich,Development Bank of Kenya Ltd, Fidelity Commercial Bank Ltd and K-Rep Bank Ltd. The study recommends that the inefficient banks should especially improve their non-cash loans and should control their annual expenditures.

Keywords: Return on Assets; Banking; Large; Medium; Small (search for similar items in EconPapers)
JEL-codes: A11 (search for similar items in EconPapers)
Date: 2016
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