n AfricaGrowth Agenda - Firm characteristics and capital structure of firms listed on Nairobi Securities Exchange, Kenya

Volume 2015, Issue 10
  • ISSN : 1811-5187


This study used explanatory research design where all non-financial firms listed on NSE for the period 2007-2012 were purposively selected. Multivariate regressions analysis was used to assess the relative importance of firm, industry and country level factors on capital structure. The results show that firm characteristics significantly influence capital structure and account for 9.9% of variations in total debt ratios highlighting the fact that the use of total debt among non-financial firms are generally low. However, industry level factor account for the greatest variations in debt ratios. The study recommends that in order for non-financial firms to increase their level of debt capital, they should invest more of their resources on non-current assets that can be pledged as collateral for debt capital.

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