IMPACT OF MACROECONIMICS VARIABLE ON PERFOMANCE OF BANKS

Abstract

ABSTRACT This study sought to examine the impact of macroeconomic variables on performance. of banks (ROA): A Case of Commercial Banks in Tanzania Specific objectives were; to assess the effect economic growth on performance of banks M Tanzania, to 55055155 515 impact of exchange rate on performance of banks in Tanzania, to determine the impact of interest rates on performance of banks in Tanzania and to evaluate the impact of money supply on performance of banks in Tanzania. As for this study, a correlation research design was used in conducting the research. For the purpose of this study, he sample was taken from yearly range data of 2009 to 2020 Secondary data was used in this study. The data was collected from various sources. These included the World Bank Indicators, IMF, BOT and MOF economic reports Data was quantified and coded using descriptive and inferential statistics with aid of STATA Version 13. Findings of this study unveiled that economic growth has significant relationship with commercial banks performance. Results of this study indicated that exchange rate has insignificant relationship with commercial banks performance. Findings of this study revealed that interest rate has insignificant relationship with commercial banks performance. Also, results of this study indicated that, money supply has insignificant relationship with commercial banks performance. Future studies should be conducted into challenges facing the commercial banks. This will explain help to reveal how best the challenging can be overcome hence promoting efficient implementation, monitoring and evaluation of commercial banks. Moreover, further research could be carried out on other commercial banks in the East African region to establish the impact of macroeconomic variables on performance of banks.