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ABSTRACT
The study is on the impact of capital structure on the financial performance of commercial banks in Kenya. The study adopted the panel data regression method. The outcome of the study revealed that total debt to total assets ratio has a negative significant impact on financial performance of commercial banks in Kenya, short-term debt to total assets ratio has a positive significant impact on financial performance of commercial banks in Kenya, longterm debt to total assets ratio has a negative significant impact on financial performance of commercial banks in Kenya. The study however recommends that to improve the financial performance of their banks, Kenyan commercial banks' management should commit to a more excellent short-term debt-to-total-assets ratio and aim to lower overall debt to total assets and long-term debt to total assets.
