Actors Affecting Deposit Mobilization: The Case Of Cooperative Bank Of Oromia Sendafa Bake Branch

Abstract

The objective of the thesis is assessing and identifying the factors influencing the deposit mobilization at Sandafa Branch, Oromia National Regional State. The study used explanatory research design. The response variable is deposit mobilization while the predictor variables are Service Quality, Interest rate, Branch expansion, Technology, Disposable income, and awareness. First, developed a likert scale questionnaire and then changed the variables into quantitative via the factor analysis. Using the sample size determination 395 respondents were taken into account. The descriptive statistics like graphs, mean, standard deviation and finally the regression model has been used. The entire dataset was analysed using the SPSS software. The result shows that service quality is the potential predictor variables influencing the deposit mobilization based on the mean. The result of the correlation coefficient shows that a relationship between dependent variable (deposit), the other six independent variables and demographic variables. As per the test result all explanatory variables have positive correlation with explained variable or Deposit mobilization. The result of the study showed that existence of the difference between several predictor variables while the joint impact of all the predictor variables are influencing the response variable by 64.4%. Accordingly, the F result in the study model is 65.977. It also shows that the significance value is 0.000, which is p < 0.05; it means that there is a significant variation between independent variables such as service quality, branch expansion, interest rate, technology, disposable income, and awareness when compared with their contribution to dependent variables. The test statistic reveals that the null hypothesis that all of the coefficients are jointly zero and should be rejected. Thus, we can conclude that service quality, proximity to customers, interest rate comparable with inflation rate, provision of appropriate technology, economic growth, and awareness creation have variable relationship or variable rates of contribution to customer attraction and deposit mobilization. Finally, it is recommended that the bank has to pay utmost attention to service quality in order to attain higher deposit mobilization performance .