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May 23, 2026Journal of Economics Finance and Management StudiesOpen Access

Loan Portfolio Investment and Financial Performance of Deposit Taking Savings and Credit Co-Operatives in Kenya

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Authors

DODavid Masini OmwansaTOTobias OlwenyJWJoshua Matanda Wepukhulu

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Overview

Longitudinal panel study reveals positive effects of loan portfolio allocation on financial performance in deposit-taking cooperatives, indicating credit risk management maximizes returns.

Key Points

  • To evaluate the effect of loan portfolio investment on the financial performance of deposit-taking savings and credit cooperative societies.
  • Conducted a longitudinal panel study analyzing census data from 182 licensed deposit-taking savings and credit cooperative societies in Kenya collected by the Sacco Societies Regulatory Authority from 2015 to 2023.
  • Modeled financial performance using return on assets and loan portfolio investment using the total loans to total assets ratio via fixed effects panel regression.
  • Loan portfolio investment demonstrated a statistically significant positive effect on return on assets (coefficient = 0.336592, p = 0.0000).
  • Increasing the proportion of assets allocated to loan portfolios improved financial performance, although the observed magnitude of the effect was comparatively small.

Cite This Study

Omwansa et al. (2026) studied this question.

synapsesocial.com/papers/6a75b5e720e137e1c1161b60https://doi.org/10.47191/jefms/v9-i5-33
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Also Consider

Synapse has enriched 5 closely related papers on similar clinical questions. Consider them for comparative context:

  1. 1Loan Portfolio Management and the Financial Performance of Deposit-Taking Savings and Credit Co-operative Societies in Kenya2026
  2. 2Investment in other Financial Institutions and Financial Performance of Deposit Taking Savings and Credit Cooperatives in Kenya2026
  3. 3Credit Risk Management and Financial Performance: Evidence from Deposit-Taking Savings and Credit Cooperative Societies in Kenya.2025
  4. 4Asset Quality and Financial Performance of Deposit Taking Savings and Credit Cooperative Societies in Kenya2024
  5. 5Effect of Loan Risk Management Strategies on Financial Performance of Deposit Taking Sacco Societies in the Lake Region Economic2026