Determinants of Financial Performance of Tanzanian Banks

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dc.creatorLotto, Josephat
dc.creatorKakozi, Ezra
dc.date2020-10-23T10:27:03Z
dc.date2020-10-23T10:27:03Z
dc.date2016
dc.date.accessioned2022-10-21T11:34:05Z
dc.date.available2022-10-21T11:34:05Z
dc.descriptionJournal Article
dc.descriptionThis paper examines factors that affect bank performances in Tanzania for the period of 2006 to 2013. The empirical results suggest that high net interest margins (NIM) and return on bank assets (ROA) are significantly associated with larger banks that hold a relatively high amount of capital. However, such banks have lower liquidity levels and poor management quality measured by how efficiently they reduce operating expenses. This calls for banks owners to review the performance of banks management in relation to their incentive packages so as to match management remunerations with their contribution towards bank performance. No impact was found of macroeconomic variables measured by GDP growth rate and inflation on bank interest margin and profitability. Also the findings show that micro-financial factors, measured by financial structure and market concentration, are worth less to banks interest margin and profitability in Tanzania. As a matter of policy implications at the bank level, the improvement of the profitability of Tanzanian banks need to be conducted by a reinforcement of the capitalization through national regulation programs, and by reducing the proportion of non-interest bearing assets to the benefit of bank loans.
dc.formatapplication/pdf
dc.identifierhttp://154.72.94.133:8080/xmlui/handle/123456789/128
dc.identifier.urihttp://hdl.handle.net/123456789/86206
dc.languageen
dc.publisherThe African Journal of Finance and Management
dc.subjectbank, internal and external factors, interest margin, profitability, Tanzania
dc.titleDeterminants of Financial Performance of Tanzanian Banks
dc.typeArticle

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