Comparative Analysis on the Effects of Covid-19 Pandemic on Banks’ Performance in Tanzania. A Case of Commercial Banks in the Lake Zone, 2020.

Abstract

The global effect of novel Coronavirus on the banking sector is a subject that needs thorough analysis. The present study was undertaken to assess the comparative effect of COVID-19 on the CRDB and NBC bank in the Lake zone from 1st January to 30th June 2020 in Tanzania. The study was longitudinally designed to allow the researchers to explore and analyse the effects of COVID- 19 on the Tanzanian Banking sector. The study applied statistical analysis techniques such as ANOVA for analysis of differences in bank performance within the stated period and paired sample t-test for comparison of the bank’s performance before and after COVID-19 outbreak. Only secondary data were collected from CRDB and NBC Bank Zonal offices in Mwanza and a deep analysis was undertaken to assess the effect of COVID-19 pandemic on bank’s performance before and after the outbreak of COVID-19. The variables that were tested included loan ratio, retail banking operations and mobile banking trends. The findings revealed that there was a decrease in loan ratios, a slight decrease in retail banking operations and a huge increase in mobile banking transactions as reflected from the results. This study recommends that banks should emphasize the use of mobile banking as it has proved to be the best alternative banking channel. Further studies should be conducted on other banking operations such as Net Interest Margin, profit expense margin, ROA, ROE and just to name a few.