TALENT MANAGEMENT PRACTICES AND PERFORMANCE OF COMMERCIAL BANKS IN NAIROBI CITY COUNTY, KENYA

Lydia Magambo Mugure, Dr. Thomas Mose

Abstract


Commercial banks play a vital role in the economic development of Kenya, particularly in Nairobi City County, which serves as the country's financial hub. These banks facilitate financial intermediation, enabling individuals and businesses to access credit, manage savings, and make investments. However, the performance of commercial banks in Nairobi City County has shown signs of distress in recent years. Reports indicate that non-performing loans (NPLs) have risen sharply, with the ratio of NPLs to total loans reaching approximately 14.4% in 2022, significantly above the Central Bank of Kenya's recommended threshold of 5%. The general objective of the study was to assess the effect of talent management practices on performance of commercial banks in Nairobi City County, Kenya. Specifically, the study seeks to determine the influence of talent acquisition on performance of commercial banks in Nairobi City County, Kenya and to examine the effect of employee compensation on performance of commercial banks in Nairobi City County, Kenya. The descriptive research design was employed where data was collected one point in time. The unit of analysis for the study was 41 commercial banks in Kenya (CBK, 2022) while the unit of observation was management employees. The accessible population was 246 individuals comprising of 41 top managers, 82 middle level managers and 123 lower-level managers. The study’s sample size was reached at using Krejcie and Morgan sample size determination formula. Therefore, using the formula, the sample size for the study was 207 respondents. This study also used questionnaire to collect data relevant to this study. Quantitative data collected was analyzed using descriptive statistical techniques which are frequencies, mean, standard deviation. Inferential statistics which include Pearson correlation and the Regression Analysis Model was used to test the relationship between study variables. The significance of the model was tested at 5% level of significance. Data was analysed using Statistical Package for Social Sciences (SPSS) software. The study results were presented through use of tables and figures. The study concludes that talent acquisition has a positive and significant effect on performance of commercial banks in Nairobi City County, Kenya. The study also concludes that employee compensation has a positive and significant effect on performance of commercial banks in Nairobi City County, Kenya. Based on the findings, this study recommends that the management of commercial banks should invest in a more strategic and data-driven talent acquisition process

Key Words: Talent Management Practices, Talent Acquisition, Employee Compensation, Performance of Commercial Banks


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