Intellectual Capital, Operational Resilience and Financial Performance of Performance of Commercial Banks in the Central Region of Uganda.
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Date
2023
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Abstract
The study sought to establish the relationship between intellectual capital, operational resilience and financial performance of commercial banks in the central region of Uganda. Particularly, it focused on examining the relationship between intellectual capital and the financial performance of commercial banks in the central region of Uganda, the relationship between operational resilience and the financial performance of commercial banks in the central region of Uganda and the predictive power of intellectual capital and operational resilience on the financial performance of commercial banks in central region of Uganda.
The study used a cross-sectional research design, which followed a quantitative research approach. The study focused on the 28 Supervised Commercial Banks in Uganda (BOU, 2020) and a sample size of 24 banks was selected where the unit of analysis was banks while the unit of inquiry included the Head Credit, Head Operations, Head Finance, Branch Managers and General Manager giving a total of 168 respondents. However, only 153 respondents were reached. Primary data was obtained directly from the respondents from the selected Commercial Banks using a structured self-administered questionnaire covering all the variables of the study. A 5-point Likert scale ranging from 1(Strongly disagree) to 5(strongly agree) was adopted where respondents were asked to indicate their level of agreement with given statements/questions.
It was found that: there is a significant positive relationship between intellectual capital and the financial performance of commercial banks in the central region of Uganda (r=0.478** p≤.01). Furthermore, the findings show that there is a significant positive relationship between operational resilience and financial performance of commercial banks (r=0.641**, p≤.01). Finally, the predictive power of intellectual capital and operational resilience on financial performance of Commercial banks in central region of Uganda was determined using multiple regression and indicated that the predictor variables explained 41.9 % of the variance in financial performance (Adjusted R Square = .419). The results implied that the independent variables (intellectual capital, operational resilience) explain 41.9% of the variance on the dependent variable (financial performance).
On that basis, the study recommended that Commercial Banks need to offer training to their employees to improve their level of experience and also build a motivated workforce to encourage the staff to innovate. The study further recommended that Commercial banks should have adequate and uncommitted resources that they can quickly utilize to finance new strategic initiatives, to be in a position to meet their day-to-day obligations. Commercial banks should in addition reduce idle capacity and costs, minimize wastage and overheads to improve their profit margins and return on investments.
Description
A Dissertation Submitted to Makerere University Business School (Faculty of Graduate Studies and Research) in Partial Fulfilment of the Requirements for the Award of Degree of Masters of Business Administration of Makerere University. (PLAN A).
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Andrew, S (2023) Intellectual Capital, Operational Resilience and Financial Performance of Performance of Commercial Banks in the Central Region of Uganda. Unpublished Masters Dissertation Makerere University Business School. Kampala, Uganda.