Contribution of Evangelical Lutheran Church on financial performance of Uchumi Commercial Bank in Tanzania

Despite the government's efforts to help community banks (CBs) by giving them preferential treatment, including minimal registration start-up capital, these banks have struggled to attain superior performance. Using a quantitative research approach, this paper assessed the contribution of Lutheran Church parishes to the financial performance of Uchumi Commercial Bank (UCB), one of the community banks in Tanzania. A cross-sectional research design was used with a systematic sampling technique applied to 223 respondents. A survey questionnaire and interviews were used to collect quantitative data. Data were analyzed through descriptive statistics and multiple linear regression techniques. Parish savings, saving rate, parish non-performing loans, and shares owned by the parish were factors concluded to positively influence the bank's financial performance. Meanwhile, loans to parishes and loan repayments negatively influence performance. Additionally, the fear of losing collateral influences parishes to repay their loans, thus adversely affecting UCB bank's financial performance in terms of loan default. The study recommends that the Lutheran Church should set policies to ensure an increased level of parishes' savings, loans, and share capital to enhance the church's contribution to UCB financial performance.