Ownership Structure and Bank Performance in Zimbabwe

Abstract

The objective of this paper as to analyze the effect of ownership structure on the performance of Zimbabwean commercial bank for the period 2009 to 2011 focusing on profitability measure measured by return on equity. Empirical literature which was reviewed brought mixed results from both developed and developing countries hence the need to carry out the research focusing on the Zimbabwean scenario. From the population of all commercial banks in Zimbabwe a multistage sampling technique was used with banks firstly divided into strata followed by convenient sampling from each strata based on the availability of annual reports. Financial statements were collected from Bank Scope database. Analysis of Variance (ANOVA) was used to analyze data and the results revealed that bank ownership structure does not have any effect on profitability. Thus in conclusion, ownership structure does not have an effect on bank performance. This paper recommends that banks should adopt techniques to boost their profitability regardless of their identity.

Keywords: Ownership structure, Return on equity, Bank performance, ANOVA, Zimbabwe