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Contribution of corporate social responsibility on financial performance: A case of NMB PLC at Morogoro municipality
(Mzumbe University, 2014) Ayo, Happy Kyungai
Corporate Social Responsibility (CSR) is a rapidly developing, key business issue. It is a concept that has attracted worldwide attention. Due to the demands for enhanced transparency and corporate citizenship, CSR started to embrace social, ethical as well as environmental challenges. Today, companies are aware of the social and environmental impacts of international production. It is accepted that Companies should not be only profitable, but also good corporate citizens. This research work was carried out at NMB PLC with the aim of assessing the impact of corporate social responsibility on organization financial performance a case of NMB PLC at Morogoro Municipality. The methods used in data collection were observation, interview and questionnaire. Collected data were analyzed using Ms Excel and statistical package for social sciences (SPSS).data presentation was based on tables and figures shows frequencies and percentages. From the findings, result of analysis implies that there is no direct relationship between CSR and financial performance, respondents commented that most area which got CSR contribute nothing to the bank performance but just receive CSR as aid and to make community enjoy. On the side of contribution of CSR on NMB PLC performance the analysis reveal that activities of CSR affect return of the Bank by reducing amount of profit instead of reinvest the profit and increase value of asset, on the challenge facing company on engaging in CSR the result implies that shareholders are not willing to offer CSR as wealth not maximized but minimized. Conclusion of the study shows that respondent comment on agent theory that shareholders are not willing to engage in CSR program as wealth are not maximized but minimized also larger number of respondents comment that CSR improve more reputations and company image and not financial performance of the company.
Determinants of interest rate spread in commercial banks: A case study of selected local and foreign banks in Tanzania
(Mzumbe University, 2013) Aikoh, Kenedy J.
The behaviour of interest rate spread in Tanzania for a very long period of time have been strong, high and persistently showing little signs of narrowing. When compared with other East African countries, interest rate spread in Tanzania seems to be the highest. It is this persistent and low narrowing trend of the interest rate spread which gave rise to the need of studying the factors which causes high interest rate spread in commercial banks in Tanzania. The overall objective of this study was to identify the Determinant of interest rate spread in commercial banks in Tanzania and comparing the interest rate spread between the selected banks. The determinants were ascertained from review of previous literatures. Related parameters from the selected determinants were studied for the chosen banks for the period between 2006 and 2012, a period after adoption of market determined interest rate regime. The study based on the secondary data from 28 quarters of published quarterly reports of the selected commercial banks and Bank of Tanzania quarterly economic bulletin publications. Multiple regressions were applied to establish relationship between the dependent variable, interest rate spread and the chosen independent variables which were non-interest income, provision for loan losses, non-performing loans, non-interest expenses, gross domestic product rate, treasury bills rate and inflation. The results from the study indicate that the key determinants of interest rate spread for the selected commercial banks are the treasury bills rate; Real GDP rate, Non-interest income, NII; Provision for loan losses, PLL and Non-performing loans, NPL. The results also show that the interest rate spread for the selected local commercial bank is higher than that of the selected foreign commercial bank. The policy implication from the study is that the high responsiveness of commercial banks spread to the treasury bills and real GDP rate needs to be regulated. This study can be extended by exploring the impact of financial sector development on interest rate spreads in commercial banking system.
Contribution of the investment portfolio management strategies on assets growth: A case study of Local Authority Pension Fund
(Mzumbe University, 2015) Kyaruzi, Godfrey
This study intended to examine major investments portfolio that makes contribution towards the assets growth of LAPF. Specific objectives that guided data collection were: To establish investment choice taken by LAPF; to select optimal assets portfolio of the LAPF in the study; and to estimate the optimal portfolio equation for a time series data of 2005 to 2014. In conducting this study, the researcher used a case study design; he collected and used secondary data through interviews and document analysis. The study revealed that, there are a number of strategies and modes the Fund took in the investment portfolio management towards assets growth which include measures like: leadership commitment and engagement of all stakeholders, public awareness, diversification of portfolio, good governance and risk management, allocation of portfolio assets properly, and marketing of portfolio. It is also reported that members‟ contribution increased by an average of 34.12% for ten years, this was attributed by the increment of the Fund‟s members. The study also revealed that, investment portfolio contributes 80.85% of the LAPF assets growth. Finally, it was found out that there were a number of challenges that the Fund faced in investment portfolio management, these included: few listed companies and therefore funds are forced to invest in government securities and real estate (investment property), government interventions, political factors, accountability problems, poor life-cycle cost analysis, problems in budgeting process and budget authority, and inadequate tracking of portfolio performance over its full life cycle. The researcher recommended grouping initiatives using common resources to leverage the knowledge and expertise; portfolio management should treat opportunities, initiatives and projects as investments, and the Fund must incorporate objective criteria to evaluate both existing investments and new investment proposals.
Corporate governance practices and investment performance: A case study of selected pension schemes in Tanzania
(Mzumbe University, 2013) Mkilalu, Emanuel
Sustainability of pension funds depends on investment performances. The best corporate governance practices is indeed the key issue influencing investment performance of public pension schemes. This study was designed to analyze performances in relation to corporate governance practices. The objective of this study is to determine the effect of corporate governance practices on the performance of the pension scheme. The study focused in three selected pension funds in Tanzania, namely, the Public Service Pension Fund, National Social Security Fund and Parastatal Pension Fund. Theoretical and empirical studies of this work relied on the relationship between corporate governance practices and performance of pension schemes. The study used both primary and secondary data as the means of collecting data with a comparative case study orientation. Published financial statements and other desk materials were collected principally from case public pension schemes. In addition, Interviews were also made with responsible top management and officials from planning and investment departments of the funds. The study found the relationship between the corporate governance best practices and investment performance, Social Security Regulatory Authority controls and monitor the investment in these selected pension scheme but it should not limit the pension schemes to invest outside the country as this is the only way to diversity the local risks. Stakeholders and employees should be actively involved in the conduct of good corporate governance practices as this is the only way successes could be achieved in its effect on the performance of pension scheme in Tanzania
The Determinants of non-performing assets in Finca International Incorporation: A Case Study of Morogoro branch
(Mzumbe University, 2015) Bernard, Beatrice John
Microfinance Institutions (MFIs) in the World currently provide significant financial services including microcredit facilities particularly to the rural and semi-urban areas across the country. Granting of microcredit facility (Loan) is a major activity of the mfis and the loan portfolio constitute a significant proportion of the assets of the MFIs. Undoubtedly, the mfis derive most of their interest incomes from loans, however, not all loans granted to beneficiaries perform well and earn the expected returns and this tend to have adverse effect on the quality of the loan portfolio. The purpose of the study was to find out the Determinants of non-performing assets in Microfinance Institutions. The study focused on trend of Non-Performing Assets at FINCA as a whole and the causes or factors for Non-Performing Assets at FINCA Morogoro Branch. The study reviews both theoretical and empirical aspects of nonperforming Assets. Chi-square analysis is employed, both primary and secondary data were used for the study. The study found FINCA recorded significant amounts as non-performing assets in the five-year period reviewed and has adversely affected the financial performance of the organization by reducing its operating profits, loanable funds and undermining the liquidity position. The findings revealed that external factors are more prevalent in causing non-performing assets in FINCA. Findings suggest that integrity of borrower such that use of funds for purposes different from agreed ones as a major factor that cause n pas. Close monitoring of borrowers is critical to lending business, good relationship with borrowers was found to be the most favorable strategy of reducing non-performing assets. The researcher suggests future studies should be broad to assess the performance of Credit Risk Management in line with the level of NPA in mfis. This thesis is organized into five chapters. Chapter one covers introduction of the study. Chapter two presents review of related literature. In this chapter, the key issues concerning Non-performing Assets are discussed. Chapter three is the research methodology. Chapter four discusses various findings and analysis, while several recommendations and conclusion are found in chapter five.