Ishimwe Jean Luc*1, Gitahi Njenga2
1 School of Business and Economics, Mount Kenya University, Kigali Rwanda
2 Mount Kigali University, Kigali Rwanda
* Corresponding Author: tuvier90@gmail.com
Abstract
This research investigated the impact of diversification on organizational performance at Banque Populaire du Rwanda (BPR). The study aimed to assess how channel and product diversifications affect BPR’s financial performance. Using a descriptive research design, the researcher focused on a population of 45 individuals, employing a census sampling technique to include all participants. Both qualitative and quantitative methods were utilized, with self-administered questionnaires as the primary data collection tool, supplemented by content analysis for validation. Data analysis included descriptive statistics, correlation, and regression, with findings presented in tables. Results showed that 77.8% of respondents strongly agreed that BPR products targeting the diaspora contribute to high profits, while 91.1% noted that financial security enhances competitive advantage. Additionally, 82.2% agreed that electronic banking improves customer satisfaction. The study also examined the return on equity (ROE) from 2019 to 2022, with ratios of 25.7%, 7.97%, 12.16%, and 18.56%, indicating shareholder interest in financial performance. The correlation analysis revealed a strong positive relationship (r = 0.894, p < 0.01) between diversification strategies and BPR’s performance, confirming the hypothesis. In conclusion, BPR should implement robust measures to enhance diversification strategies to improve performance, and financial institutions should prioritize effective management procedures to support these initiatives.
Keywords: Diversification Strategies, Financial Performance, Banking Sector, Rwanda
