Abstract:
Deposit mobilization is the major services of commercial banks. The main business for banks is
accepting deposits and granting loans. The more the loans the banks mobilize the funds and may be
expected the more profit they make. Also, banks do not have a lot of their own money to give as loans.
They depend on customer deposits to generate funds for granting loans to other customer this process is
known as deposit mobilization. However, managing deposits is not possible without knowing and
controlling the factors affecting it. Therefore, the study adopts qualitative and quantitative or mixed
approach to gather the data. The primary data is gathered by using four-page questionnaire to eight
selected private banks like AIB, BB, BOA, BIB, CBO, DB, NIB, and WB based on the date of
establishment and their capital and While the secondary sources of data were extracted from National
Bank of Ethiopia (NBE). The study used time series data from 2009/10 G.C-2020/21G.C for analysis
made using Multiple linear regression. The study reveals that branch expansion and GDP per capita
among selected banks are the most significant factors of deposit volume. Besides, the other variables
inflation, and deposit interest rate respectively has moderate and smaller power to influence deposit
mobilization activity. Finally recommended that private banks ought to increase number of branches
both rural and urban to mobilize more resources, introduce new technology, improve service quality by
providing cash and in kind incentive, maintain enough liquidity fund, provide adequate customer
handling training to their staffs and so forth.
