CREDIT INFORMATION SHARING AND FINANCIAL PERFORMANCE OF COMMERCIAL BANKS IN KENYA

Abstract

Despite of implementing a number of determinants to improve financial performance of Commercial Banks, Banks still declare deficit on the outcome of operation in Kenya today hence need for further study. The study therefore examines the influence of credit information sharing and financial performance Commercial Banks. Mixed method which comprised of quantitative and qualitative designs was applied in this study. Target population was 43 licensed Commercial Banks in Kenya from which one hundred and seventeen (117) managers were purposely selected to form sample size. Cronbach Alpha test of 0.961 was obtained indicating the reliability of the research instrument. Content and criterion validity were ensured through incorporating the experts’ suggestions in the final document. Data was analyzed using descriptive statistics and inferential statistics which included correlation analysis and bivariate regression analysis and multiple regression analysis after testing for normality, multicollinearity and performing factor analysis. The study findings established a strong positive correlation between credit information sharing and financial performance. I recommend the commercial banks to scrutinize information through Credit reference Bureaus in order to avoid multiple loaning and reduce non-performing loans. Further study should be conducted to establish whether managers tenure of office effects the relationship between credit information sharing and commercial banks financial performance in Kenya