Factors Affecting the Financial Performance of Saccos in Kenya: A Case of Selected Sacco's
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Abstract
The objective of this study was to provide an understanding of the factors affecting the financial performance of Sacco's in Kenya to bridge the knowledge gap that exists. The results indicated that there was a strong correlation between dividend policy and financial performance, while a correlation between increased surplus and performance showed that there was a strong negative correlation. Similarly a correlation between loan portfolio and performance showed that there was a weak positive correlation. The adjusted R2 is 41% and the value of F statistics observed is 3.789 which are higher than critical value of F- distribution of 1.92 and hence the model is good. It was also concluded that of the three factors that affect the financial performance of Sacco's, dividend policy has the highest impact with a strong positive correlation of 0.697 while loan portfolio and increased surplus had correlations of 0.209 and -0.055 respectively.