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This study explored the bank-specific and macroeconomic factors influencing capital adequacy in South African commercial banks. In this research, a balanced panel data set comprising 11 recapitalized banks was employed, spanning the period from 2008 to 2019. Employing panel regression techniques including OLS, Fixed Effects, Random Effects, and the Generalized Method of Moments (GMM), the analysis examines the influence of profitability (ROA), bank size, leverage, broad money supply, and the central bank’s monetary policy rate on the Capital Adequacy Ratio (CAR). The results indicate that profitability, bank size, leverage, and the broad money supply are critical determinants of capital sufficiency. Banks with increased profitability and increased exposure to the money supply typically demonstrate more robust capital positions. Larger bank size and increased leverage levels negatively affect capital adequacy ratios. The little impact of the delayed CAR signifies minimal persistence in capital buffer methods over time, implying that banks may not significantly depend on prior year capital conditions in their current capital planning. The study highlights the complex nature of capital sufficiency, influenced by microeconomic factors such as size and leverage, as well as macroeconomic indices like the money supply. The findings substantiate the Capital Buffer Theory and furnish critical insights for regulators, bank executives, and policymakers seeking to bolster the resilience of the banking industry in South Africa.

The COVID-19 pandemic triggered a global economic crisis that significantly impacted the South African banking sector, already weakened by a pre-existing recession. While bank profitability and credit quality declined, stock market reactions appeared less severe, indicating a potential disconnect between fundamentals and investor behaviour. This study explores the influence of investor sentiment on credit risk, lending, and performance (ROA) of selected JSE-listed banks during the pandemic, incorporating behavioural finance perspectives. Panel regression analysis reveals that COVID-19 had a significant negative effect on stock, ROA and ROE, driven by heightened uncertainty and rising non-performing loans. Liquidity and capital positively influenced returns and ROE, reflecting investor confidence in resilient banks. Investor sentiment had a weakly positive impact on returns, but a significant negative effect on both ROA and ROE, suggesting that excessive optimism may have led to riskier lending practices and reduced profitability. Larger banks underperformed in terms of returns, likely due to operational complexity during the crisis. These findings highlight the critical role of behavioural factors in shaping financial outcomes during systemic shocks and provide new insights into emerging market banking dynamics under crisis conditions.

This study examined the effect of deposit diversification on the financial performance of Deposit-Taking Savings and Credit Cooperative Societies (DT-SACCOs) in Kenya and evaluated the moderating effect of corporate governance on this relationship.  The study adopted a positivist research philosophy and a causal research design. The target population comprised 176 SASRA-licensed DT-SACCOs in Kenya, from which 122 SACCOs with complete financial records for the period 2015–2024 were selected using simple random sampling. Panel data techniques, including fixed-effects and random-effects regression models, were employed to estimate the direct and moderating effects, while hierarchical regression was used to test the moderation hypothesis. The findings revealed that non-withdrawable deposits significantly and positively influenced both surplus and dividend payout after introducing lags, whereas withdrawable deposits had no significant effect on financial performance. The results further established that corporate governance had a positive and significant direct effect on financial performance and significantly strengthened the relationship between deposit diversification and financial performance. The findings provide practical guidance for DT-SACCO managers and policymakers to strengthen stable deposit mobilization and corporate governance as mechanisms for enhancing financial sustainability and institutional performance.

This study examined the effect of deposit diversification on the financial performance of Deposit-Taking Savings and Credit Cooperative Societies (DT-SACCOs) in Kenya and evaluated the moderating effect of corporate governance on this relationship.  The study adopted a positivist research philosophy and a causal research design. The target population comprised 176 SASRA-licensed DT-SACCOs in Kenya, from which 122 SACCOs with complete financial records for the period 2015–2024 were selected using simple random sampling. Panel data techniques, including fixed-effects and random-effects regression models, were employed to estimate the direct and moderating effects, while hierarchical regression was used to test the moderation hypothesis. The findings revealed that non-withdrawable deposits significantly and positively influenced both surplus and dividend payout after introducing lags, whereas withdrawable deposits had no significant effect on financial performance. The results further established that corporate governance had a positive and significant direct effect on financial performance and significantly strengthened the relationship between deposit diversification and financial performance. The findings provide practical guidance for DT-SACCO managers and policymakers to strengthen stable deposit mobilization and corporate governance as mechanisms for enhancing financial sustainability and institutional performance.

This study explored the bank-specific and macroeconomic factors influencing capital adequacy in South African commercial banks. In this research, a balanced panel data set comprising 11 recapitalized banks was employed, spanning the period from 2008 to 2019. Employing panel regression techniques including OLS, Fixed Effects, Random Effects, and the Generalized Method of Moments (GMM), the analysis examines the influence of profitability (ROA), bank size, leverage, broad money supply, and the central bank’s monetary policy rate on the Capital Adequacy Ratio (CAR). The results indicate that profitability, bank size, leverage, and the broad money supply are critical determinants of capital sufficiency. Banks with increased profitability and increased exposure to the money supply typically demonstrate more robust capital positions. Larger bank size and increased leverage levels negatively affect capital adequacy ratios. The little impact of the delayed CAR signifies minimal persistence in capital buffer methods over time, implying that banks may not significantly depend on prior year capital conditions in their current capital planning. The study highlights the complex nature of capital sufficiency, influenced by microeconomic factors such as size and leverage, as well as macroeconomic indices like the money supply. The findings substantiate the Capital Buffer Theory and furnish critical insights for regulators, bank executives, and policymakers seeking to bolster the resilience of the banking industry in South Africa.

The COVID-19 pandemic triggered a global economic crisis that significantly impacted the South African banking sector, already weakened by a pre-existing recession. While bank profitability and credit quality declined, stock market reactions appeared less severe, indicating a potential disconnect between fundamentals and investor behaviour. This study explores the influence of investor sentiment on credit risk, lending, and performance (ROA) of selected JSE-listed banks during the pandemic, incorporating behavioural finance perspectives. Panel regression analysis reveals that COVID-19 had a significant negative effect on stock, ROA and ROE, driven by heightened uncertainty and rising non-performing loans. Liquidity and capital positively influenced returns and ROE, reflecting investor confidence in resilient banks. Investor sentiment had a weakly positive impact on returns, but a significant negative effect on both ROA and ROE, suggesting that excessive optimism may have led to riskier lending practices and reduced profitability. Larger banks underperformed in terms of returns, likely due to operational complexity during the crisis. These findings highlight the critical role of behavioural factors in shaping financial outcomes during systemic shocks and provide new insights into emerging market banking dynamics under crisis conditions.