Abstract
The purpose of this study is to investigate the performance of financial institutions in five Sub-Saharan African countries: Kenya, Nigeria, Namibia, Rwanda and Senegal. The investigation is based on four proxies towards performance namely: financial access, financial depth, financial efficiency and financial stability. The overall proxies are composed of thirty variables. There are four objectives in the study; the first objective has examined access and information of financial services in financial institutions of Sub-Saharan African countries. The second objective investigated and measured depth of financial institutions. The third objective evaluated efficiency of financial institutions in Sub-Sahara Africa. The last objective was intended to measure the stability of financial institutions in Africa. We created a development of financial performance model describing the proxies and variables in this study. The main analysis of the study is Mean calculation and regression analysis by using weighted Least Squares multiple regression analysis (WLS). This study investigated secondary data. The data was analyzed by using Excel software and Statistical Package for Social Sciences (SPSS) in descriptive statistics. The result of all target countries except Nigeria is significant in financial access. Result also showed significance in financial depth of all five target countries. The financial institutions of all five target countries are inefficient. Also the result of financial stability in financial institutions of target countries showed insignificance except Rwanda.
Highlights
History of African Financial Institutions Africa passed through four centuries of slavery including the so called sixty years of colonial rule
The researcher wants to remind the readers of this report of the context of African financial institutions in historical perspective that the African work of financial services is based on the Islamic law which is a common system and practice determining cohering ideas, selecting applications under different material conditions, and the underlying principles of guidelines and legal provisions relative to the institutional means when it comes to mediating views from Islamic different doctrines
The major benefits of pawning were mechanism of access to capital in the perspective of customers and investment of surplus with security and return in the perspective of lenders. Both Islamic and Yoruba cases contributed culture and commercial fabric to the history of African financial institutions but in respect of economic concepts and ideas, the Islamic tradition has a legal discourse while Yoruba does not have. When it comes to credit and debt management, time always was a fluid concept but at the beginning of the 19th century, the western colonial rule contributed per their understanding of time as a fixed measure and this concept of time measurement was incorporated into the African financial institutions
Summary
History of African Financial Institutions Africa passed through four centuries of slavery including the so called sixty years of colonial rule. The major benefits of pawning were mechanism of access to capital in the perspective of customers (loan seekers) and investment of surplus with security and return in the perspective of lenders (creditors) Both Islamic and Yoruba cases contributed culture and commercial fabric to the history of African financial institutions but in respect of economic concepts and ideas, the Islamic tradition has a legal discourse while Yoruba does not have. When it comes to credit and debt management, time always was a fluid concept but at the beginning of the 19th century, the western colonial rule contributed per their understanding of time as a fixed measure and this concept of time measurement was incorporated into the African financial institutions. For the first time in the history of African financial institutions, loans, repayments and contributions were adjusted to the rural income under the French rule colony (Stiansen & Guyer, 1999)
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