THE IMPACT OF BOARD GOVERNANCE ON FINANCIAL STABILITY IN KENYAN MICROFINANCE BANKS

This study evaluated the effect of board independence on financial stability of microfinance banks in Kenya. The 14 microfinance banks in Kenya constitute the target population and subsequently sample size based on a census approach. Utilizing quantitative methods, descriptive statistics, and panel data regression analysis, data was analyzed and summarized; result was based on panel data regression analysis. Board independence had a negative and significant effect on financial stability of microfinance banks in Kenya. The study recommends that the central bank of Kenya should develop and enforce specific guidelines or regulations that mandate a minimum level of board independence for microfinance banks