IDEAS home Printed from https://ideas.repec.org/a/eme/mrrpps/v39y2016i10p1265-1292.html
   My bibliography  Save this article

The impact of name change on the financial performance of savings and credit co-operatives in Kenya

Author

Listed:
  • David Mutua Mathuva
  • Elizabeth Wangui Muthuma
  • Josephat Mboya Kiweu

Abstract

Purpose - This paper aims to investigate the impact of name change, if any on the financial performance of deposit-taking savings and credit co-operatives (SACCOs) in a developing country characterized by a vibrant SACCO sector. Sparse studies exist on the impact of name changes on revenue-cost performance in mutual financial institutions such as SACCOs. Design/methodology/approach - The study uses a standard event methodology over a six-year period (2008-2013) to investigate the impact of name change on the return on assets (ROA) and operating profit margin (OPM). The study then uses a panel regression method to study the impact of name change on ROA and OPM for a sample of 212 deposit-taking SACCOs over the period 2008-2013. Findings - The results, which are robust for a variety of controls, provide evidence in support of a consistent positive association between name change and subsequent financial performance of deposit-taking SACCOs in Kenya. The positive impact of name change seems to be experienced about four years after the name change. The results reveal muted influence of regulation on name change and financial performance of SACCOs in Kenya. Research limitations/implications - The study focuses solely on deposit-taking SACCOs in a developing country context over a six-year period only. Extending the time period and including a sample of control SACCOs operating purely back-office service activities would add power to the analyses. Practical implications - The current study illustrates the contribution of name change on the financial performance of SACCOs in a developing country characterized by a vibrant SACCO sector. Overall, the results show that name change announcements signal an improvement in SACCOs’ future prospects. Originality/value - This study provides empirical evidence on the contribution of name change announcements on the financial performance of SACCOs in a developing country context. The study adds to the sparse literature on the impact of name change on the financial performance of mutual financial institutions that are not listed on the securities exchange.

Suggested Citation

  • David Mutua Mathuva & Elizabeth Wangui Muthuma & Josephat Mboya Kiweu, 2016. "The impact of name change on the financial performance of savings and credit co-operatives in Kenya," Management Research Review, Emerald Group Publishing Limited, vol. 39(10), pages 1265-1292, October.
    • Handle: RePEc:eme:mrrpps:v:39:y:2016:i:10:p:1265-1292
    DOI: 10.1108/MRR-04-2015-0097
    as

    Download full text from publisher

    File URL: https://www.emerald.com/insight/content/doi/10.1108/MRR-04-2015-0097/full/html?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://www.emerald.com/insight/content/doi/10.1108/MRR-04-2015-0097/full/pdf?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://libkey.io/10.1108/MRR-04-2015-0097?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Theo Benos & Nikos Kalogeras & Martin Wetzels & Ko De Ruyter & Joost M. E. Pennings, 2018. "Harnessing a ‘Currency Matrix’ for Performance Measurement in Cooperatives: A Multi-Phased Study," Sustainability, MDPI, vol. 10(12), pages 1-38, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eme:mrrpps:v:39:y:2016:i:10:p:1265-1292. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Emerald Support (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.