Analysis of the financial performance of Centenary Bank in Uganda (2006-2016)
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The major objective of this study is to analyze the financial performance of Centenary Bank in Uganda from the year 2006 to 2016. This study was purely use secondary data. This was obtained from Centenary Bank main Branch, Mapeera House (2006-2016). The data obtained was captured using Ms Excel and was later imported into STATA for analysis. ARIMA models was used to analyze the performance of Centenary Bank in Uganda. The results from the study showed that from the year 2010, the profits greatly increased till 2016. By 2012, the profits had increased by 78.8% from the year 2006 and by the year 2016 the profits had increased by 87.7% from 2006. In order to be able to fit a forecasting model in the data series, it should be stationary. The results in further showed that the data is not stationary, however this is not conclusive and has to be confirmed by the Dickey-fuller test. Series that are not stationary was differenced in order to achieve stationarity. Profits of Centenary bank Uganda from the year 2006 to 2016 are not stationary both having a p value greater than the critical (0.05). This therefore implies that there is trend in the profits of Centenary bank Uganda. Furthermore, the study concludes that there is trend in the profits made by Centenary bank Uganda from the year 2006 to 2016. Last but not least, the study recommends that the bank managers maintain or even increase their efforts towards activities which increase the bank’s revenues since this is what increases the bank’s profits at the end of the day. Credit risk management may vary from commercial bank to another. Therefore, it is recommended that another way to develop the existing research would be performing similar research but on a different commercial Bank.