Date of Conferral
2020
Degree
Doctor of Business Administration (D.B.A.)
School
Management
Advisor
Sean Stanley
Abstract
Poor financial performance is a challenge for policy makers, industry regulators, investors, bankers, and business leaders. Understanding the relationship between organizational structure, capital structure, and financial performance is vital for business leaders to promote their long-term survival. Grounded in agency cost theory, the purpose of this quantitative correlational study was to examine the relationship between organizational structure, capital structure, and financial performance of new commercial banks in Uganda to promote their long-term survival. Archived data were analyzed using 60 bank-quarter observations of 5 Ugandan commercial banks closed within 5 years after opening, restructuring, merging, or undergoing an acquisition by another bank between 1991 and 2017. The results of standard multiple linear regression indicated the full model was able to significantly predict financial performance, F (2, 52) = 5.860, p = .005, R2 = .171. The organizational structure was statistically significant and positively related to financial performance (p = .006). Unexpectedly, the capital structure was not statistically significant (p = .074). As a key recommendation, leaders in the banking industry should focus on implementing an efficient organizational structure to promote the long-term survival of commercial banks. The implications for positive social change include the opportunity for bank leaders and regulators to develop strategies to improve financial performance, ensure longtime survival of banks, and the benefits that accrue from the existence of these banks.
Recommended Citation
Kakande, Adam, "Relationship of Organizational Structure and Capital Structure on Financial Performance of Banks" (2020). Walden Dissertations and Doctoral Studies. 8932.
https://scholarworks.waldenu.edu/dissertations/8932
