European Journal of Accounting, Auditing and Finance Research (EJAAFR)

EA Journals

Rwanda

An Assessment of the Factors That Affect the Financial Performance of the Cross-Listed Companies in the Rwanda Stock Exchange (Published)

This research study entitled An Assessment of the Factors that Affect the Financial Performance of the Cross-Listed Companies in the Rwanda Stock Exchange aimed at assessing the factors that affect the financial performance of the cross listed companies on the RSE. As a guidance, the research examined the relationship between the level of awareness of the market by the public and the financial performance of cross-listed companies in RSE, assessed how the regulation framework affect the financial performance of the cross-listed companies on the RSE feature, and finally determined how technology affects the performance of cross-listed companies. The companies under consideration were the primary stakeholder of the RSE totalling to 14 firms which included Capital Market Authority, Rwanda Stock Exchange, the 9 brokerage firms and the 3 cross listed firms in the RSE employing 97 workers. Through a descriptive survey design, a sample size of 67 participants were selected from the 97 workers and 100 other informants identified purposively and their responses to various data collection tools particularly questionnaires and interview guides captured for analysis. The data were analysed through Hermeneutics, Thematic analysis, and Multiple Regression techniques to answer the questions that the research ventured out to investigate. The result of the analysis showed that there was a negative correlation between awareness and financial performance of the firms, regulation framework was positive and significant with r (67) = .684, P = .037, while technology correlated with r = .506, p = .094. Market capitalization of the domestic companies was larger than that of cross-listed, and return on equity of the domestic firms was better than for the cross-listed companies. Generally the cross-listed companies did not perform any better than the domestic firms though overall the public awareness, technology and regulation framework positively correlated with financial performance of the cross-listed firms. The recommendation is that more awareness strategy needed to be devised so as to increase public awareness of investors and cross-listing companies need to be motivated by other factors other than making profits when choosing.

Keywords: Capital market, Financial Performance, Market Capitalization, Rwanda, profit, stock exchange

Business Environment and the Growth of Foreign Direct Investments in the Information and Communication Technology Sector in Rwanda in 2012 – 2013 (Published)

This research work was carried out to examine the extent to which improved business environment contributed to the growth of Foreign Direct Investments in the Information and Communication Technology sector in Rwanda in 2012-2013. Rwanda continues to undertake reforms towards making the country a favorable place for investment. On the 2014 World Bank “Doing Business” report, the country was ranked as the 2nd most improved in the world and the second easiest place to do business in Africa. In 2012, Foreign Private Capital inflows to Rwanda increased by 14.8 percent to $ 409.3 million compared to $356.6 million recorded in 2011. The capital inflows were dominated by Foreign Direct Investments, amounting to $ 255.0 million, and accounting for 62.3 percent of total inflows. The Information and Communication Technology sector attracted the highest flows (41.2%). The study established that, the improved business environment moderately influenced (Pearson correlation coefficient of 0.537and significance -2 tailed- of 0.35), the attraction of Foreign Direct Investments to the Information and Communication Technology sector in Rwanda in 2012-2013. Regulations which improved the ease of establishing business operations, security, growth and sustainability of investments had the highest influence on foreign investors in choosing Rwanda as their investment destination. These covered the areas of good governance, good macro-environmental factors, investor protection, ease of getting credit, ease of starting a business and enforcement of contracts ranked among the top six influencers, in that order, by over 91% of the foreign investors. Insolvency resolution was found to be of great importance particularly to the large foreign investors (above Rwf 75 million in equity investments and turnover above Rwf 50 million as per the World Bank 2014 report) who required a clear exit plan. 50% of these investors ranked the indicator in the upper quartile of the most influential variables. Untapped business opportunities attracted three large multi-nationals to the Information and Communication Technology sector and contributed to the impressive growth of Foreign Direct Investments registered in the Information and Communication technology sector. Publicity by the World Bank Doing Business report, of the impressive transformation and commitment to lower the cost of doing business that was demonstrated by Rwanda, was found to have created considerable interest among 40% of the foreign investors selected. The study adopted a cross-sectional survey and descriptive research design and both secondary data and primary data were utilized. Questionnaires were administered accompanied by interviews to obtain accurate information from the selected sample. Statistical Package for Social Sciences (SPSS) was used for correlation analysis while Microsoft Excel was used for the listing, ranking and analysis of variables. The tools of summarization of data were statistical tables, histograms, line charts and bar charts. For the qualitative data, simple listing of suggestions, factors and other itemized variables was adopted. Pearson correlation was used to study the relationship between the business environment and the level of Foreign Direct Investments registered.

Keywords: Business Environment, FDI, ICT, Rwanda

E-Banking and Performance of Commercial Banks in Rwanda A Case of Bank of Kigali (Published)

The purpose of this research was to examine the contribution of E-banking towards banking on performance of banking Institutions in Rwanda because according to National bank of Rwanda (NBR Report, 2012) there is delay in payment of checks between banks; time wasted in banks as people line in queue waiting for service, errors as a result of manual work and fraud related cases was common. Bank clients complain of the above hence the researcher was interested to examine the contribution of this system to banking efficiency in Rwanda. The study used descriptive research design by basing on qualitative and quantitative approach in order to get better analysis of the study. Both primary and secondary data collection tools were used with their relevant tools like questionnaire and documentary analysis in order to come up with required data. In the findings it was established that Electronic banking system like ATM, Pay direct, electronic check conversion, mobile telephone banking and E transact has a great impact on bank performance because they increase profitability, reduce bank cost of operations, and increase bank asset and bank efficiency. The great contributions of e banking on banking performance is shown in table 4.21 which provides the relationship between E banking and Performance of bank of Kigali in Rwanda whereby the respondents N is 44 and the significant level is 0.01, the results indicate that independent variable has positive high correlation to dependent variable equal to .656** and the p-value is .000 which is less than 0.01. When p-value is less than significant level, therefore researchers conclude that variables are correlated and null hypothesis is rejected and remains with alternative hypothesis. This means that there is a significant relationship between E banking and Performance of bank of Kigali in Rwanda. As conclusion E banking contributes to positive performance of banks as witnessed by of bank of Kigali.

Keywords: Bank of Kigali, Commercial Banks, Rwanda, e-Banking

Scroll to Top

Don't miss any Call For Paper update from EA Journals

Fill up the form below and get notified everytime we call for new submissions for our journals.