EFFECT OF CAPITAL ADEQUACY ON FINANCIAL PERFORMANCE OF MICROFINANCE BANKS IN KENYA
Sammy Mutiria Murige - Tharaka University, Kenya
Dr. Tumaini Mwikamba - Tharaka University, Kenya
Dr. James Nyamu - Tharaka University, Kenya
ABSTRACT
Microfinance banks (MFBs) play a critical role in ensuring financial inclusion for low-income individuals and small businesses excluded from commercial banking. However, the sector’s financial performance has deteriorated sharply in recent years, with the Central Bank of Kenya reporting a sector-wide pre-tax loss of approximately Ksh 3.5 billion in 2024, up from Ksh 2.4 billion in 2023, alongside a negative return on assets of 6.1 percent, attributed to high non-performing loans, capital erosion, shrinking deposits and operational inefficiencies. Despite the sector’s economic importance, literature remains inconclusive regarding the precise relationship between capital adequacy and the financial performance of MFBs in Kenya. This study therefore assessed the effect of capital adequacy, measured through the Capital Adequacy Ratio, on the financial performance of Kenyan MFBs, measured using Return on Assets (ROA). The study was anchored on Capital Buffer Theory and adopted a positivist research philosophy together with an explanatory and descriptive research design. A census of all 14 Central Bank of Kenya-licensed MFBs was undertaken, yielding secondary panel data spanning 2011 to 2024. Data were analysed using STATA version 19.0 and R version 4.6.1, employing robust Fixed Effects panel regression to draw empirical inferences following diagnostic testing for multicollinearity, heteroskedasticity and model specification. The Hausman specification test favoured the Fixed Effects estimator (χ² = 16.152, p < 0.001), under which Capital Adequacy demonstrated a positive and statistically significant effect on Return on Assets (β = 0.0165, p < 0.05). The model was statistically significant overall (F = 6.535, p < 0.05), leading to rejection of the null hypothesis that capital adequacy has no statistically significant effect on financial performance. The findings imply that capital buffers above minimum statutory requirements are a fundamental driver of MFB profitability, a conclusion of particular urgency given that at least half of Kenya’s fourteen licensed MFBs are estimated to require a combined Ksh 2.9 billion in fresh capital to meet the tiered core-capital requirements proposed under the Microfinance Bill, 2026. The study recommends that MFB management prioritise maintaining capital buffers above minimum statutory requirements to absorb operational risks, and that the Central Bank of Kenya adopt a differentiated, risk-based regulatory framework for capital requirements that accounts for the scale and risk profile of individual institutions.
LEVERAGING CAREER DEVELOPMENT FOR IMPROVED STAFF RETENTION: EMPIRICAL EVIDENCE FROM HUMAN RESOURCE CONSULTANCY FIRMS IN NAIROBI COUNTY, KENYA
LEVERAGING CAREER DEVELOPMENT FOR IMPROVED STAFF RETENTION: EMPIRICAL EVIDENCE FROM HUMAN RESOURCE CONSULTANCY FIRMS IN NAIROBI COUNTY, KENYA
Irene Mwende Muia - MBA Candidate, School of Business, Economics and Tourism, Kenyatta University, Kenya
Laura Munene (PhD) - Lecturer, School of Business, Economics and Tourism, Kenyatta University, Kenya
ABSTRACT
Human resource consultancy firms operate in highly competitive and knowledge-driven environments where attracting and retaining competent employees remains a major strategic concern. Despite the growing importance of human capital in sustaining organizational performance, many consultancy firms continue to experience high employee turnover, loss of skilled personnel, declining employee commitment, and increasing recruitment and training costs. Career development initiatives have increasingly emerged as critical human resource strategies aimed at improving employee motivation, professional growth, job satisfaction, and long-term retention. This study examined the effect of career development initiatives on staff retention in human resource consultancy firms in Nairobi County, Kenya. The study is anchored on Human Capital Theory and Social Exchange Theory, which collectively explained how investment in employee growth enhances organizational commitment and retention. A descriptive research design was adopted targeting management employees from registered human resource consultancy firms operating in Nairobi County. Data were collected using structured questionnaires administered through a five-point Likert scale. Validity and reliability of the research instrument were established through expert review and pilot testing. Quantitative data were analyzed using descriptive statistics and simple linear regression analysis. The findings established that career development initiatives had a statistically significant positive effect on staff retention. Specifically, mentorship programs, promotion opportunities, professional training, career progression structures, and succession development enhanced employee commitment, job satisfaction, and long-term organizational attachment. The study recommends that management of human resource consultancy firms should strengthen career development frameworks by investing in continuous professional development, structured mentorship systems, transparent promotion policies, and employee growth opportunities to improve retention of skilled personnel. Strengthening career development initiatives can enable consultancy firms to enhance employee loyalty, reduce turnover costs, and maintain organizational competitiveness in the dynamic human resource consulting industry.
EXPLORING COMMON CO-OCCURRING CONDITIONS LIKE ADHD, ANXIETY, DEPRESSION AND EPILEPSY IN INDIVIDUALS WITH AUTISM AND HOW TO MANAGE THESE ADDITIONAL CHALLENGES
EXPLORING COMMON CO-OCCURRING CONDITIONS LIKE ADHD, ANXIETY, DEPRESSION AND EPILEPSY IN INDIVIDUALS WITH AUTISM AND HOW TO MANAGE THESE ADDITIONAL CHALLENGES
Dr. Norman Kiogora
ABSTRACT
Autism spectrum disorder (ASD) often co-occurs with a range of additional conditions that can complicate diagnosis and treatment. Among the most common co-occurring conditions are attention-deficit/hyperactivity disorder (ADHD), anxiety, depression, and epilepsy. These conditions can significantly impact the overall well-being and developmental progress of individuals with autism. ADHD, characterized by symptoms such as inattention, hyperactivity, and impulsivity, often exacerbates challenges in managing daily tasks, focusing in educational settings, and regulating behavior. Anxiety and depression are prevalent among individuals with autism, contributing to social withdrawal, emotional distress, and difficulty coping with changes or sensory overload. Epilepsy, occurring in a significant subset of individuals with autism, can result in seizures that disrupt cognitive development and daily functioning. Managing these additional challenges requires an integrated, individualized approach that addresses both the core symptoms of autism and the co-occurring conditions. Early diagnosis of co-occurring conditions is essential to developing comprehensive treatment plans. For ADHD, behavioral therapies, structured routines, and, in some cases, medication can help manage impulsivity and attention deficits. Anxiety and depression may be addressed through cognitive-behavioral therapy (CBT), relaxation techniques, and, when appropriate, medication to stabilize mood and reduce anxiety. Epilepsy management typically includes antiepileptic drugs (AEDs), along with close monitoring of seizure activity and potential side effects. An interdisciplinary approach involving clinicians, educators, therapists, and families is crucial to providing holistic care. By focusing on the unique needs of individuals with autism and their co-occurring conditions, strategies can be developed to improve functioning, promote emotional well-being, and enhance overall quality of life. Early intervention, personalized treatment, and ongoing support are essential in addressing the complexities of managing autism with co-occurring conditions.
INNOVATION STRATEGIES AND PERFORMANCE OF SMALL AND MEDIUM ENTERPRISES IN THE COSMETICS SECTOR IN NAIROBI CITY COUNTY, KENYA
INNOVATION STRATEGIES AND PERFORMANCE OF SMALL AND MEDIUM ENTERPRISES IN THE COSMETICS SECTOR IN NAIROBI CITY COUNTY, KENYA
Hassan, S. H. - MBA Strategic Management Student, School of Business and Entrepreneurship, Jomo Kenyatta University of Agriculture and Technology, Kenya
Dr. Enos Anene (PhD) - Lecturer, School of Business and Economics, Jomo Kenyatta University of Agriculture and Technology, Kenya
ABSTRACT
Purpose: Despite operating in a rapidly growing sector, cosmetics SMEs have exhibited fluctuating financial performance over the past five years, reflected in inconsistent trends in ROA, market share, and revenue growth. The study examined the effect of innovation strategies on the performance of cosmetics small and medium-sized enterprises (SMEs) in Nairobi City County, Kenya. The study was anchored on the diffusion of innovation theory. Methodology: The study adopted a descriptive research design targeting 600 registered cosmetics SMEs operating in Nairobi City County. A stratified random sampling technique was employed to ensure proportional representation of manufacturers, wholesalers, and retailers, resulting in a sample size of 240 SMEs. Primary data were collected using structured questionnaires administered to business managers, one from each selected firm, and complemented by secondary financial data. Prior to the main study, a pilot study involving 24 respondents was conducted to assess the validity and reliability of the research instrument. The pilot study achieved a response rate of 83.3%. Content validity results yielded an overall Content Validity Index (CVI) of 0.86, while construct validity was confirmed through factor analysis, with all factor loadings exceeding the recommended threshold of 0.50. Reliability results indicated satisfactory internal consistency, with Cronbach’s Alpha coefficients ranging from 0.804 to 0.873 and an overall reliability coefficient of 0. 836.Data were analyzed using descriptive and inferential statistics, including Pearson’s Product–Moment Correlation and multiple linear regression analysis. Findings: The findings established that innovation strategies had a positive and statistically significant effect on the performance of cosmetics SMEs. The regression model explained 69.1% of the variation in SME. Recommendations: The study recommends that SME managers prioritize continuous innovation to enhance competitiveness and long-term sustainability. Policymakers should formulate supportive policies that promote innovation, facilitate access to finance, strengthen SME capacity-building programs for cosmetics SMEs.
KISE-EXPO 2024 REPORT
The Kenya Institute of Special Education (KISE)
ABSTRACT
Specialized learning materials, Assistive devices and technology have the power to transform lives, enabling individuals living with special needs and disabilities to access education, independence, and participation in society. With over 2.5 billion people globally requiring at least one assistive device, the need for innovative solutions is clear. The Kenya Institute of Special Education (KISE) organized the KISE-Expo 2024 on the 5th and 6th of September, 2024, providing an essential platform for stakeholders manufacturers, users, and policymakers to come together. The expo promoted awareness, partnerships, and the development of inclusive solutions that enhance the quality of life for persons living with special needs and disabilities.
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