Factors Affecting Deposit Mobilization of Commercial Banks in Ethiopia in Case of Bank of Abyssinia S.C
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Date
2023-06-03
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A.A.U
Abstract
Deposit is one of the resources financial institutions highly motivated to mobilize the liquid asset
that is found in the treasury of the bank and which is ready to be dispensed to whom in need. The
deposit mobilization of the banks can be affected by lots of different factors. This study tried to
fill the gap that considering there are more factors that are as significant as the major commonly
known factors; interest rate, inflation rate, exchange rate which affect deposit mobilization such
as; emerging banks which are ethnic based, permit of foreign well-organized banks in order to
be established and the impacts which result from new NBE proclamations. The general objective
of the study is to examine the factors affecting deposit mobilization in commercial banks of
Ethiopia in the case of BoA S.C. A mixed methods research approach underpinned by a
pragmatist research philosophy, using predominantly quantitative methods with some qualitative
elements added after analysis of the quantitative data to further explain key findings of the
research. This study has been conducted through all the four grade branches of BOA (from
Grade 1-3 and corporate branch) by selecting four branches (one from each) and district and
head office staffs. As branches with same grade are homogenous in all aspects because of the
bank’s standard, and since they all possess a same organizational structure, behaviour and
culture plus working environment four branches will be selected randomly. Descriptive and
inferential techniques have been adopted for analysis of data collected from questionnaire
respondents. The study shows that the factors that effect of deposit movement were the human
capital, deposit mobilization strategy, interest rate, product and services, and government roles
and political conditions. as a result, adopting strong strategic plan which is measurable and
feasible aligned with continual review of the dynamic market could help the bank to mobilize the
resources which the bank highly in need of it and helps them to deal with the dynamic business
environment.
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Keywords
Commercial Banks, Ethiopia, Bank of Abyssinia S.C