An evaluation of financial strategies used by companies in the retail sector during recession period (2000-2010).

This paper analyses financial strategies for Zimbabwean companies in the retail sector industry in an economy characterized by recession from 2000 to 2010. The paper sought to meet the following objectives among others; to identify the various operating financial strategies available for companies operating in recession; assess the applicability of various short and medium term financial strategies for Zimbabwean companies and; provide a prescription to various stakeholders in the retail sector on evidence based operating financial strategies. Research findings showed that many companies ceased operations voluntarily and in most cases involuntarily. Others adopted a variety of financial strategies ranging from scaling down operations, streamlining business operations, being selective in service delivery to putting plants and machinery under care and maintenance. There was liquidity crunch in the market and as a result, companies failed to get funding; banks failed to attract meaningful deposits to provide companies with funding. Lack of operating finance was the chief cause why companies failed to reach pre-2000 operating levels. The study recommended companies to taking advantage of priority option in making payments as well as adopting a thorough recession management approach. Ignoring the impact of recession and its repercussions with the view that it would go away proved to exacerbate the problem. Key words: Recession Management, Capacity Utilization, Depression, Multi-Currency, Working Capital

The Factors Influencing SMEs Growth in Africa: A Case of SMEs in Zimbabwe

Today Africa reports high levels of unemployment among other social issues causing governments’ instability and low economic growth. Brain drain, low gross domestic product (GDP) per capita and growth reported across the continent requires an initiative on driving entrepreneurship development. The study seeks to investigate the determinants of small to medium enterprises (SMEs) growth in developing countries with a special focus on Zimbabwe. Informed by literature, the Zimbabwe Finscope Business Consumer Survey (2012) data was used to run a linear programming model regression analysis on the factors influencing SMEs profitability in that country. The study found that number of business units, education level, business type, family run businesses, expertise, licenced, advertising and bank account were significant in influencing SMEs profitability. The results will assist policymakers, development partners, entrepreneurs and other stakeholders. The insight can also be useful to venture capitalists, investment banks, investors and other financiers. There is need to support the millions of SMEs and future entrepreneurs in improving the regulatory and business environment, improving institutional support systems, promoting technology transfers, innovations and improving productivity

Determinants of bond yield spread changes in South Africa

This paper offers an emerging market perspective on the determinants of bond yield spread changes. The study covers the period 2005-2013 and it is based on a sample of 106 corporate vanilla bonds listed on the South African market. To capture the impact of the financial crisis of 2007-2008, the sample period is split into three sub periods, the pre-financial crisis (2005-2006), mid-financial crisis (2007-2009) and post financial crisis (2010-2013). The study shows that changes in equity volatility, interest rate level and the yield curve slope are significant determinants of bond yield spreads. The impact of equity volatility and interest rate level is more pronounced during the mid-financial crisis period. Controlling for credit ratings and bond convexity does not alter the findings. The study confirms the results documented in developed countries, and highlights the key determinants of bond values and returns of active bond trading strategies. For policy makers, the findings of this study call for further measures and reforms to address liquidity challenges on the bond market and volatility induced by non-resident investors.Keywords: Equity volatility; Bond yield spread changes; Corporate bonds; South Africa; Emerging market

The determinants of financial inclusion in selected African countries

Summary in English, Sesotho and ZuluThis thesis investigated the determinants of financial inclusion with the emphasis on social networks in selected African countries, namely, the Democratic Republic of the Congo, Kenya, Eswatini and South Africa. Many individuals in Africa are still excluded from using formal financial services. Low financial inclusion can result in income disparity, poverty and sluggish economic growth. The purpose of this study was to comprehend and explain financial inclusion, while examining the effects of social networks on financial inclusion. An empirical exploration was conducted to establish theoretically hypothesised relationships. The study contributed to the existing body of literature in that it determined the contribution of social networks to individual financial inclusion, a topic which had not been explored adequately. Probit models were run, using Finscope Surveys data to estimate the determinants of financial inclusion in the selected African countries. The following variables were considered: age, gender, marital status, proof of residence, bank access, location, education status, social networks, getting financial advice, monthly salary, annual income, access to internet and the use of mobile phones. Linear probability models were used to check for robustness. Robust consistent errors were used to reduce the effect of heterogeneity. The use of merged data showed that social networks significantly influence financial inclusion in most of the selected African countries, with the exception of the Democratic Republic of the Congo, although a relationship was found to exist. The results also showed that the variable ‘access to internet’ is significant in all country datasets, except for the DRC. The variable ‘getting financial advice’ is significant in all five datasets. The study recommends that the governments of the countries studied invest in improving the information and communications technology infrastructure in their countries in order to improve access to financial services and the use thereof. Finally, as part of financial inclusion, concerted efforts should be made to disseminate financial advice through the internet and social media platforms to influence how financial decisions or choices are made.Phuputso ena e batlisitse mabaka a kenyeletso ya ditjhelete ka toboketso ya dikgokahano tsa setjhaba dinaheng tse kgethilweng tsa Afrika, e leng, Rephabliki ya Demokrasi ya Congo, Kenya, Eswatini le Afrika Borwa. Batho ba bangata Afrika ba ntse ba qhelelwa ka thoko tshebedisong ya ditshebeletso tsa ditjhelete e hlophisitsweng. Kenyeletso e tlase ya ditjhelete e ka baka ho se lekane ditabeng tsa ditjhelete, bofuma le kgolo e monyebe ya moruo. Sepheo sa phuputso ena e ne e le ho utlwisisa le ho hlalosa kenyeletso ya ditjheleteng, ha ho ntse ho hlahlojwa diphello tsa dikgokahano tsa setjhaba kenyeletsong ya ditjhelete. Patlisiso ya dinnete e ile ya etswa ho theha dikamano tse inahanelwang tsa mehopolo. Phuputso e kentse letsoho dingodilweng tse teng ka hore e lekantse tlatsetso ya dikgokahano tsa setjhaba ho kenyeletso ya ditjhelete ka bomong, sehlooho se neng se sa hlahlojwa ka ho lekana. Mokgwa wa tshusumetso o ile wa etswa, ho sebediswa dintlha tsa Diphuputso tsa Finscope ho hakanya ditekanyo tsa kenyeletso ya ditjhelete dinaheng tse kgethilweng tsa Afrika. Ho ile ha nahanwa ka dikarolo tse latelang: dilemo, bong, boemo ba lenyalo, bopaki ba bodulo, phihlello ya banka, sebaka, boemo ba thuto,dikgokahano tsa setjhaba, ho fumana dikeletso tsa ditjhelete, moputso wa kgwedi, lekeno la selemo, phihlello ya inthanete le tshebediso ya mehala ya thekeng. Mekgwa e fapaneng ya menyetla e ile ya sebediswa ho lekola matla. Diphoso tse matla tse tsitsitseng di sebedisitswe ho fokotsa phello ya ho fapana. Tshebediso ya dintlha tse kopaneng e bontshitse hore dikgokahano tsa setjhaba di susumetsa kenyeletso ya ditjhelete dinaheng tse ngata tse kgethilweng tsa Afrika, ntle le Rephabliki ya Demokrasi ya Congo, leha ele hore kamano e fumanwe e le teng. Diphetho di boetse di bontshitse hore 'phihlello ya inthanete' e fapaneng e bohlokwa ho disete tsa dintlha tsohle tsa dinaha, ntle le DRC. Mofuta o fapaneng wa 'ho fumana keletso ya ditjhelete' o bohlokwa ho disete tsohle tsa dintlha tse hlano. Phuputso e kgothaletsa hore mebuso ya dinaha tse ithutilweng e tsetele ho ntlafatseng meralo ya theknoloji ya tlhahisoleseding le dikgokahano dinaheng tsa yona e le ho ntlafatsa phihlello ya ditshebeletso tsa ditjhelete le tshebediso ya tsona. Qetellong, e le karolo ya kenyeletso ya ditjhelete, ho lokela hore ho etswe boiteko bo kopanetsweng ho phatlalatsa keletso ka tsa ditjhelete ka inthanete le dithala tsa metjha ya phatlalatso ya ditaba tsa setjhaba ho susumetsa hore na diqeto tsa ditjhelete kapa dikgetho di etswa jwang.Lo mqondo uphenye izinkomba zokufakwa kwezezimali kugcizelelwa ukuxhumana nabantu emazweni akhethiwe ase-Afrika, okungukuthi, iDemocratic Republic of the Congo, Kenya, ESwatini kanye neNingizimu Afrika. Abantu abaningi e-Afrika basabekelwe nxanye ekusebenziseni izinsizakalo ezisemthethweni zezezimali. Ukufakwa kwezezimali okuphansi kungaholela ekungalingani kwemali engenayo, ubumpofu kanye nokukhula komnotho okuntengantengayo. Inhloso yalolu cwaningo bekuwukuqonda nokuchaza ukufakwa kwezezimali, ngenkathi kubhekwa imiphumela yokuxhumana nabantu ekufakweni kwezezimali. Ukuhlola okwenziwe ngamandla kwenziwa ukuze kusungulwe ubudlelwano obucatshangelwayo. Ucwaningo lube nomthelela ohlakeni lwezincwadi olukhona ngoba lunqume umnikelo wokuxhumana nabantu ekufakweni kwezezimali ngakunye, isihloko ebesingakahlolwa ngokwanele. Amamodeli kaProbit aqhutshwa, kusetshenziswa idatha yeZinhlolovo zikaFinscope ukulinganisa izinkomba zokufakwa kwezezimali emazweni akhethiwe ase-Afrika. Lokhu okuguqukayo okulandelayo kubhekiwe: ubudala, ubulili, isimo somshado, ubufakazi bendawo yokuhlala, ukufinyelela kwebhange, indawo, isimo semfundo, ukuxhumana nomphakathi, ukuthola izeluleko ngezezimali, umholo wanyanga zonke, imali engenayo yonyaka, ukufinyelela kuyi-inthanethi nokusetshenziswa komakhalekhukhwini. Amamodeli wamathuba wokulinganisa asetshenziselwe ukubheka ukuqina. Kusetshenziswe amaphutha angaguquki aqinile ukunciphisa umphumela wokungafani. Ukusetshenziswa kwemininingwane ehlanganisiwe kukhombisile ukuthi ukuxhumana nomphakathi kunomthelela omkhulu ekufakweni kwezezimali emazweni amaningi ase-Afrika akhethiwe, ngaphandle kweDemocratic Republic of the Congo, yize kwatholakala ukuthi kukhona ubudlelwano. Imiphumela futhi ikhombise ukuthi okuguquguqukayo 'ukufinyelela kuyi-inthanethi' kubalulekile kuwo wonke amasethi wedatha wezwe, ngaphandle kweDRC. Ukuhlukahluka 'kokuthola izeluleko zezezimali' kubalulekile kuwo wonke amasethi wedatha amahlanu. Ucwaningo luncoma ukuthi ohulumeni bamazwe abafundile batshale imali ekwenzeni ngcono ingqalasizinda yezobuchwepheshe bezokwazisa nokuxhumana emazweni abo ukuze kuthuthukiswe ukutholakala kwezinsizakalo zezezimali nokusetshenziswa kwazo. Ekugcineni, njengengxenye yokufakwa kwezezimali, kufanele kwenziwe imizamo ebumbene yokusabalalisa izeluleko zezezimali nge-inthanethi kanye nezinkundla zokuxhumana ukuze kube nomthelela ekutheni izinqumo zezimali noma ukukhetha kwenziwa kanjani.Business ManagementD. Phil. (Management Studies

DERIVATIVE MARKET: AN INTEGRAL PART OF THE ZIMBABWE STOCK EXCHANGE

The study assesses the need for a derivative market as an integral of Zimbabwe Stock Exchange. It also aims to evaluate the feasibility of establishing a derivative market as an essential element of Zimbabwe Stock Exchange. The research identifies factors that need to be addressed to facilitate such a market. Views of various fund managers, financial analysts and dealers drawn from asset management firms were used. Changes in market trends are influenced by hyper inflation and acute financial policies increase the level of unpredictability in fund growth and return. Asset managers need to be in a market where they are able to actively manage and devise mechanisms that promote fund growth and managing the risks they are exposed to. The study revealed that there are many institutional arrangements lacking to facilitate this financial innovation. A thorough analysis of the research findings was made and it concluded that there is need for a derivative market as it can be an efficient vehicle for improving investment performance

The Impact of Effective Credit Risk Management on Bank Survival

A number of financial institutions have collapsed or experienced financial problems due to inefficient credit risk management systems. The study seeks to evaluate the extent to which failure to effectively manage credit risk led to Zimbabwe’s banks’ demise in 2003/2004 bank crisis. It also seeks to establish other factors that led to the banking crisis and to outline the components of an effective credit risk management system. The study found that the failure to effectively manage credit risk contributed to a greater extent to the banking crisis. The research also identified poor corporate governance, inadequate risk management systems, ill planned expansion drives, chronic liquidity challenges, foreign currency shortages and diversion from core business to speculative non-banking activities as other factors that caused the crisis. There is also need for banks to develop and implement credit scoring and assessment methodologies, review and update the insider lending policies and adopt prudential corporate governance practices.credit, risk management, bank failure, bank survival

The Impact Of Globalisation On Banking Service Quality In Zimbabwe (2003-2008)

The study sought to investigate the impact of globalization on the quality of products in a developing economy banking sector. The objectives of the research were to ascertain whether globalisation helps restore or maintain confidence in the banking sector; ensure a sound financial sector; helps reduce fraudulent activities and whether the implementation of global measures improves the quality of products in the banking sector. Zimbabwe banking sector was used as a case study. Questionnaires and interviews were used to collect the data in addition to documentary review. It was found that globalization ensures efficient service delivery as human bank tellers; long queues and underutilisation of internet were still in existence in the banking system. Globalisation of the banking sector is essential in that it brings new technology which help improve banking services and infrastructure hence reduce fraudulent activities, new risk management techniques and increased confidence in the banking sector.Zimbabwe, globalisation, banking service quality, efficiency

Derivative Market: An Integral Part Of The Zimbabwe Stock Exchange

The study assesses the need for a derivative market as an integral of Zimbabwe Stock Exchange. It also aims to evaluate the feasibility of establishing a derivative market as an essential element of Zimbabwe Stock Exchange. The research identifies factors that need to be addressed to facilitate such a market. Views of various fund managers, financial analysts and dealers drawn from asset management firms were used. Changes in market trends are influenced by hyper inflation and acute financial policies increase the level of unpredictability in fund growth and return. Asset managers need to be in a market where they are able to actively manage and devise mechanisms that promote fund growth and managing the risks they are exposed to. The study revealed that there are many institutional arrangements lacking to facilitate this financial innovation. A thorough analysis of the research findings was made and it concluded that there is need for a derivative market as it can be an efficient vehicle for improving investment performance.Zimbabwe Stock Exchange, derivative market, fund management

Central Bank Independency On The Development Of The Financial Sector. A Case Of Reserve Bank Of Zimbabwe (1998-2008)

The study looks deeper in the relationship between central bank independence and Gross Domestic product growth and other economic variables which are indicative of improved performance with specific reference to a developing economy. It seeks to find out how the central bank policies affected the state of development of the financial sector and the extent to which the banking sector influenced economic development in the economy. The research also aims to find out how the government affected or influenced the state of development of the financial sector in the country. It was found that the government was sorely dependent on central bank financing as a matter of survival due to limited sources of finance as GDP decline meant a reduction tax revenue base. Rising inflation and contracting real incomes put pressure on the fiscal budget. Questionnaires, interviews and document review were used to obtain information for the study. It was concluded that the cohesion between fiscal and monetary policy is of paramount importance; and there was need for a high degree of formal instrument independence.Central Bank Independence, Reserve Bank of Zimbabwe

Factors Influencing the Zimbabwe Stock Exchange Performance (2002-2007)

This paper assesses the factors that influenced the Zimbabwe Stock Exchange’s performance from 2002 to 2007. The study seeks to identify and define the major drivers of the bourse during this period and use them to guide an investor on the ZSE or any other stock exchange in a developing economy. Despite the shrinking of the economy since 2000, the stock market inversely reacted to the factors that affected the economy negatively. The ZSE was driven mainly by speculation as investors sought to hedge against hyperinflation. The decline of the Zimbabwe economy during that period caused capital flight to the stock market pushing prices up hence huge profits. The real factors that affect share investment and the stock market in general were addressed, giving insight to the stock investors. The study recommends that stock investors should keep track of the general and unique factors that have an impact on their investments.ZSE Performance, Speculation, Hedging, Investment, Inflation