EFFECT OF INVESTMENT DECISIONS ON FINANCIAL PERFORMANCE OF DEPOSIT-TAKING SAVINGS AND CREDIT COOPERATIVE SOCIETIES IN NAIROBI COUNTY, KENYA

BEATRICE KERUBO MORWABE, PROF. WILLY MUTURI (Ph.D)

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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