The objective of this study was to establish the relationship between profitability and financial deepening among commercial banks in Kenya. The study adopted a descriptive survey design covering quantitative methods. The study targeted 39 commercial banks operating in Kenya and census was used. Secondary data was gathered over a period of 5-years (2016-2020) and analyzed through descriptive and inferential statistics. The findings were that ROA (β=.112, t>1.96 & p<0.05), ROE (β =.101, t>1.96 & p<0.05), bank size (β =.119, t>1.96 & p<0.05) as well as capital adequacy (β =.105, t>1.96 & p<0.05) were all significant predictors of financial deepening among commercial banks in Kenya. The study concludes that profitability is a significant predictor of financial deepening. The study recommends that finance managers of commercial banks in Kenya should come up with sound strategies aimed at improving profits so as to contribute towards financial deepening. The policy makers of the commercial banks in Kenya should develop sound policies and strategies aimed at enhancing the profits generated and thus improving on financial depth. The policy makers at the CBK should develop relevant and sound regulations that encourage and promote financial deepening among commercial banks. The policy makers at KBA should also develop relevant policies for their members that encourage financial deepening.

show more