Mushi, Isabela Stephen2021-08-262021-08-262020Mushi, Isabela Stephen (2020) Effect of capital structure and commercial Banks performance in Tanzania: the case of CRDB Bank, Master of dissertation, University of Dar es Salaamhttp://41.86.178.5:8080/xmlui/handle/123456789/15461Available in print form, East Africana Collection, Dr. Wilbert Chagula Library, Class mark (THS EAF HG1616.C34T34M874)Decision concerning to capital structure is of brilliant vital to managers as capital plays numerous integral capabilities in the operations of banks. It is vital for managers to choose an appropriate financing mix which is a key decision for the growth and going concern of any financial institutions. This study used Return on Asset as a measure of performance and Capital structure ratios include; debt ratio, debt to equity ratio, loan-to-deposit ratio and bank size were applied. The study used descriptive statistics and an Auto Regressive Distributed Lags model to analyze data collected from Cooperatives Rural and Development Bank (CRDB) from the period of 2011 to 2019. Findings from the ARDL estimation revealed that debt to equity ratio and loan to deposit ratio have positive significant impact on the commercial bank performance in the long run. With respect to short run, the findings revealed that debt ratio and lending rate have positive significant impact on the commercial bank performance. However, debt to equity ratio is observed to have a negative significant effect on the performance of the commercial banks in the short run. The study concludes that debt can be significantly influenced by liquidity and shareholders’ wealth. Consequently, the study recommends that Commercial banks focus on long-term bases only because the risk of long-term liabilities is different than for short-term debt and payables. And also, commercial banks are advised to increase their loan to deposit ratio so that in the long run they may generate more profits.enBanks and bankingCapitalBank capitalCommercial bankCRDB bankTanzaniaThesis