EFFECT OF INVESTMENT DECISIONS ON FINANCIAL PERFORMANCE OF DEPOSIT-TAKING SAVINGS AND CREDIT COOPERATIVE SOCIETIES IN NAIROBI COUNTY, KENYA
Abstract
The general objective of the study was to establish effect of investment decisions on financial performance of DT-SACCOs in Nairobi County, Kenya. Secondary data for five years that is 2014-18, for 43 DT-SACCOs was collected from SASRA and financial statements of specific DT-SACCOs; this data was analyzed using SPSS version 25. Specific objectives of study included: assessing effect of FOSA, Government Securities, Fixed Deposit Account and Shares investment decisions on financial performance of DT- SACCOs within Nairobi County. ROA was used as a measure for financial performance. Descriptive research design for a quantitative time series data was adopted using a census technique. Hypotheses were tested using correlation and regression analysis. Results indicated that FOSA have positive significant association with financial performance of DT-SACCOs. Secondly, Government securities indicated a positive significant and moderate relationship on financial performance of DT-SACCOs. Fixed deposit account had a significantly positive but low influence on financial performance of DT-SACCOs. Shares had a positive significance and substantial influence on financial performance of DT-SACCOs. The study found out that the model containing FOSA Activities, government securities, fixed deposit account and shares as investment decisions had a strong influence on changes in DT-SACCOs profitability. The study highly recommended that, management should follow a disciplined investment approach; they should follow some degree of professionalism in coming up with investment decisions, this would boost deposit SACCOs financial profitability.
Key Words: FOSA, Government Securities, Fixed Deposit Account, Shares investment
CITATION: Morwabe, B. K., & Muturi, W. (2019). Effect of investment decisions on financial performance of deposit-taking savings and credit cooperative societies in Nairobi County, Kenya. The Strategic Journal of Business & Change Management, 6 (4), 411 – 427.
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DOI: http://dx.doi.org/10.61426/sjbcm.v6i4.1398
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