scholarly journals Determinants of Commercial Banks’ Profitability. Evidence from Hungary

2018 ◽  
Vol 66 (5) ◽  
pp. 1325-1335
Author(s):  
Isah Serwadda
Keyword(s):  
Commercial Banks ◽  
Regression Models ◽  
Capital Adequacy ◽  
Panel Regression ◽  
Internal Factors ◽  
Bank Profitability ◽  
Net Interest Margin ◽  
Capital Adequacy Ratio ◽  
Asset Quality ◽  
Panel Regression Models

This paper aims to find out whether bank‑specific (internal) factors impact on the profitability of commercial banks in Hungary for 16 a year period ranging from 2000–2015. The study employs a sample of twenty‑six commercial banks with four hundred sixteen observations. The study employs return on average assets (ROAA) as a proxy for bank profitability, and it also considers bank‑specific (internal) factors as independent variables. These include asset quality (non‑performing loans), overhead costs, bank size, net interest margin, and liquidity risk plus capital adequacy ratio. The study uses panel regressions, descriptive statistics and correlation analysis for the investigations. The panel regression models are to estimate the impact of bank‑specific (internal) factors on bank profitability. The Hausman specification test was conducted on the panel regression models in order to identify the best and appropriate model for the study. The empirical findings reveal that non‑performing loans, overhead costs and liquidity had a significant negative impact on bank profitability as bank size had a significant positive impact on profitability. However, net interest margin and capital adequacy ratio had no impact on bank profitability. The study concludes that bank size and asset quality are bank‑specific factors that have the biggest impact on commercial banks’ profitability in Hungary for the period under investigation. The study recommends that commercial banks should endeavor to manage and reduce overhead costs to be able to earn more profits since overhead costs adversely affect bank profitability. More so, commercial banks’ managers should regularly monitor credit and liquidity risk indicators as well as pursuing diversification policies of income sources while upholding optimisation of operational costs.

scholarly journals Determinants of capital adequacy ratio: an empirical study on Egyptian banks

2015 ◽  
Vol 13 (1) ◽  
pp. 1166-1176 ◽  
Author(s):  
Hassan M. Hafez ◽  
Osama A. El-Ansary
Keyword(s):  
Credit Risk ◽  
Commercial Banks ◽  
Capital Adequacy ◽  
Significant Variable ◽  
Loan Loss ◽  
International Financial Crises ◽  
Management Quality ◽  
Net Interest Margin ◽  
Capital Adequacy Ratio ◽  
Asset Quality

Capital adequacy rules are safety valve for regulators and banks’ clients/shareholders to reduce expected risks faced by commercial banks especially for cross border transactions as these rules are applied compulsory by all banks internationally. Applying these rules will achieve rational management and governance. This paper examines explanatory victors that influence capital adequacy ratio (CAR) in the Egyptian commercial banks. The study covers 36 banks during the period from 2003-2013. We examined the relationship between CAR as dependent variable and the following independent variables: earning assets ratio, profitability, and liquidity, Loan loss provision as measure of credit risk, net interest margin growth, size, loans assets ratio and deposits assets ratio. Furthermore, we investigate determinants of CAR before and after the 2007-2008 international financial crises. Results vary according to the period understudy. For the whole period 2003 to 2013 results show that liquidity, size and management quality are the most significant variables. Before the period 2008 results show that asset quality, size and profitability are the most significant variables. After the period 2009 results show that asset quality, size, liquidity, management quality and credit risk are the most significant variable that explain the variance of Egyptian banks’ CAR.

scholarly journals PENGARUH RASIO CAPITAL ADEQUACY, LOAN TO DEPOSIT, NET INTEREST MARGIN TERHADAP PERTUMBUHANLABA (STUDI KASUS PADA BANK UMUM KONVENSIONALYANG TERDAFTAR DI BURSA EFEK INDONESIA)

AKUNTABILITAS ◽  
2019 ◽  
Vol 11 (2) ◽  
pp. 115-126
Author(s):  
Bambang Suryadi ◽  
Lis Djuniar
Keyword(s):  
Commercial Banks ◽  
Stock Exchange ◽  
Secondary Data ◽  
Capital Adequacy ◽  
Test Results ◽  
Net Interest Margin ◽  
Capital Adequacy Ratio ◽  
Research Population ◽  
Profit Growth ◽  
Interest Margin

This study is how Influence Ratio Capital Adequacy Ratio, Loan to Deposit Ratio, Net Interest Margin Against Profit Growth at Conventional Commercial Banks Listed on Indonesia Stock Exchange. the purpose of this study is to analyze the Influence of Capital Adequacy Ratio Ratio, Loan to Deposit Ratio, Net Interest Margin on Profit Growth at Conventional Commercial Banks Listed on Indonesia Stock Exchange. The type of research used is associative research. The research population is conventional commercial bank in Indonesia. The research variables are Capital Adequacy Ratio (CAR), Loan to Deposit Ratio (LDR), Net Interest Margin (NIM), and Profit Growth. The data used is secondary data. Data collection methods are quantitative. Partial test results show that NIM has a significant effect on Profit Growth, While CAR and LDR have no significant effect to Profit Growth.

scholarly journals Internal Determinants of Commercial Bank Profitability In Indonesia

2017 ◽  
Vol 8 (3) ◽  
pp. 219-223 ◽  
Author(s):  
Umi Widyastuti ◽  
Purwana E.S. Dedi ◽  
Sri Zulaihati
Keyword(s):  
Credit Risk ◽  
Commercial Bank ◽  
Commercial Banks ◽  
Least Squares Method ◽  
Ordinary Least Squares ◽  
Capital Adequacy ◽  
Operating Efficiency ◽  
Bank Profitability ◽  
Operating Income ◽  
Net Interest Margin

Abstract Internal determinants of bank profitability can be defined as those factors that are influenced by the bank’s management decisions and policy objectives. This paper is aimed to examine the internal factors that impact on commercial banks profitability in Indonesia. The factors reviewed in the model namely capital adequacy, credit risk (non-performing loan), liquidity (loans to deposit ratio), net interest margin and operating efficiency (operating expenses to operating income ratio). Using purposive sampling method, the analysis used thirty three commercial banks, with 168 observations for the period 2010 to 2015. Based on the Chow-test, the common effect model was preferred. The model is estimated using Ordinary Least Squares method. The results revealed that two hypotheses were not be accepted. There are no significant effects of capital adequacy and credit risk on profitability, but the model explains that there are significant effects of all explanatory variables toward commercial bank profitability. However, other important internal determinants of bank profitability still have not included in the model of this paper.

scholarly journals The Effects Of Ownership Structure And Listed Status On Bank Risk In China

2013 ◽  
Vol 29 (3) ◽  
pp. 695 ◽  
Author(s):  
Maoyong Cheng ◽  
Hong Zhao ◽  
Junrui Zhang
Keyword(s):  
Regression Analysis ◽  
Credit Risk ◽  
Ownership Structure ◽  
Commercial Banks ◽  
Capital Adequacy ◽  
Bank Risk ◽  
Capital Adequacy Ratio ◽  
Asset Quality ◽  
Relationship Of ◽  
The Relationship

This paper investigates the relationship of ownership structure, listed status and risk by using regression analysis based on the relevant data of Chinas commercial banks. Three main results emerge. First, compared to the state-owned banks, foreign-owned commercial banks exhibit better asset quality, lower credit risk and higher capital adequacy ratio; city commercial banks have lower credit risk and joint-stock commercial banks have lower credit risk and capital adequacy ratio. Second, listed status improves the asset quality and capital adequacy ratio. Finally, we also find that the listed status significantly moderates the relationship between ownership structure and risk. In conclusion, this study provides a theoretical reference for the reform of Chinas commercial banks.

PENGARUH CAPITAL ADEQUACY RATIO (CAR) DAN PENYALURAN KREDIT TERHADAP RETURN ON ASSET (ROA) DENGAN NET INTEREST MARGIN (NIM) SEBAGAI VARIABEL INTERVENING (Studi Pada Bank Umum Yang Terdaftar Di BEI Periode Tahun 2012-2016)

EXCELLENT ◽  
2018 ◽  
Vol 5 (1) ◽  
pp. 130-141
Author(s):  
Nunuk Nur Hayati ◽  
Ifah Lathifah ◽  
Bambang Kusdiasmo
Keyword(s):  
Direct Effect ◽  
Indirect Effect ◽  
Commercial Banks ◽  
Capital Adequacy ◽  
Coefficient Of Determination ◽  
Direct Influence ◽  
Research Model ◽  
Net Interest Margin ◽  
Capital Adequacy Ratio ◽  
Dominant Influence

The purpose of this study is to know, test and analyze that the CAR and Distribution of Credit affect the ROA with intervening variable NIM.The scope of research used is Commercial Banks in Indonesia listed on the BEI period 2012-2016. The number of samples in this study amounted to 9 Commercial Banks in Indonesia period 2012-2016. The analysis results show that (1) CAR has positive but not significant effect on NIM. (2) Lending has positive but not significant effect on NIM. (3) CAR has negative but not significant effect on ROA. (4) Lending has a positive and significant impact on ROA. (5) NIM has a positive and significant effect on ROA. (7) Together (simultaneously) the CAR, Credit and NIM have a significant effect on ROA. (8) The indirect effect of CAR on ROA through NIM is higher than through the direct effect of CAR on ROA. (9) Direct influence The channeling of credit to ROA is higher than through the indirect effect of Lending on ROA through NIM. (10) The most dominant influence is direct influence, because the value of direct influence through higher than the indirect effect (intervening). (11) Based on the calculation of the coefficient of determination (R2) of 0.515 this means that the ROA can be explained by the variable CAR, Lending and NIM of 51.5% and the remaining 48.5% described other variables outside the research model for example DPK, LDR and BOPO.Keywords: CAR, LENDING, NIM, ROA.

scholarly journals ANALISIS FAKTOR PENENTU DAN INDIKATOR EKONOMI PADA NET INTEREST MARGIN BANK SYARIAH

2020 ◽  
Vol 7 (11) ◽  
pp. 2074
Author(s):  
Lailatul Ayuni ◽  
Lina Nugraha Rani
Keyword(s):  
Panel Data ◽  
Commercial Banks ◽  
Annual Report ◽  
Liquidity Risk ◽  
Capital Adequacy ◽  
Influential Factor ◽  
Purposive Sampling ◽  
Net Interest Margin ◽  
Capital Adequacy Ratio ◽  
Interest Margin

ABSTRAKPenelitian ini bertujuan untuk mengetahui pengaruh faktor penentu Margin Bank Umum Syariah melalui variabel Capital Adequacy Ratio, Risiko Likuiditas, NPF, Bank Size dan indikator makroekonomi GDP dan Inflasi terhadap Net Interest Margin Periode 2011 - 2018 secara simultan dan parsial. Pengambilan sampel dengan teknik Purposive Sampling diperoleh 11 Bank Umum Syariah. Penelitian ini menggunakan pendekatan kuantitatif dengan teknik analisis regresi data panel. Data penelitian diambil dari website resmi yang dipublikasikan oleh Bank Indonesia (BI) dan Otoritas Jasa Keuangan (OJK) serta Annual Report masing – masing bank. Hasil penelitian menunjukkan adanya pengaruh signifikan antara CAR, Risiko Likuiditas, Bank Size, GDP, terhadap NIM Bank Umum Syariah. Sedangkan untuk variabel NPF dan Inflasi tidak berpengaruh signifikan. Hasil menunjukkan variabel GDP merupakan faktor yang paling berpengaruh pada Determinan Margin Bank Umum Syariah. Berdasarkan hasil penelitian tersebut, diharapkan pemerintah atau regulator dapat membantu peran perbankan dalam memberikan kebijakan dengan bentuk penyempurnaan keberpihakan regulasi dalam mendukung perbankan syariah.Kata Kunci: Net Interest Margin, Capital Adequacy Ratio, Risiko Likuiditas, Net Performing Financing, Bank Size, Makroekonomi, Bank Umum Syariah ABSTRACTThis study aims to determine the influence of the determinants of Shariah commercial bank margin through the variables of Capital Adequacy Ratio, Liquidity Risk, NPF, Bank Size and macroeconomic indicators of GDP and Inflation on the Net Interest Margin Period 2011 - 2018 simultaneously and partially. Sampling with purposive sampling technique obtained 11 Islamic Shariah commercial banks. This study uses a quantitative approach with panel data regression analysis techniques. The research data is taken from the official website published by Bank Indonesia (BI) and the Financial Services Authority (OJK) as well as the Annual Report of each bank. The results showed a significant influence between CAR, Liquidity Risk, Bank Size, GDP, on the NIM of Shariah Commercial Banks. Meanwhile, the NPF and inflation variables do not have a significant effect. The results showed that the GDP variable is the most influential factor on the Margin Determinants of Shariah Commercial Banks. Based on the results of this study, it is expected that the government or regulators can assist the role of banks in providing policies by improving regulatory alignments in supporting Islamic banking.Keywords: Net Interest Margin, Capital Adequacy Ratio, Liquidity Risk, Net Performing Financing, Bank Size, Macroeconomics, Sharia  Banks

scholarly journals On Pooled OLS and Panel Regression Models for Assessing the Contributions of Electronic Payment System on Commercial Banks Profitability

2021 ◽  
Vol 25 (2) ◽  
pp. 61-81
Author(s):  
Kayode S. Adekeye ◽  
◽  
Kelvin E. Igwe ◽  
Olaniyi M. Olayiwola ◽  
◽  
...  
Keyword(s):  
Commercial Banks ◽  
Regression Models ◽  
Payment System ◽  
Panel Regression ◽  
Electronic Payment ◽  
Payment Systems ◽  
Effect Model ◽  
The Impact ◽  
Electronic Payment System ◽  
Panel Regression Models

This study examined the impact of electronic payment system on the profitability of commercial banks in Nigeria. Pooled OLS and Panel regression models were fitted on the data extracted from the banks’ annual reports, Nigerian interbank settlement scheme, and central bank of Nigeria website. The assessment of the contribution of the various electronic payment systems considered were measured using Breusch and Pagan Lagrangian Multiplier (LM) Test, the Hausman Test, Stationarity Test, The Schwarz Criterion, and the Akaike Information Criterion. Results obtained showed that the random effect model was more appropriate than the fixed effect model for all the electronic payment systems considered in this study. Furthermore, it was discovered that there exists a positive relationship between the electronic payment systems and profitability of the commercial banks in Nigeria.

scholarly journals DETERMINANTS OF COMMERCIAL BANKS PROFITABILITY THROUGH ANALYSIS OF FINANCIAL PERFORMANCE INDICATORS: EVIDENCE FROM KOSOVO

2017 ◽  
Vol 18 (0) ◽  
pp. 160-170 ◽  
Author(s):  
Artor Nuhiu ◽  
Arbër Hoti ◽  
Mejdi Bektashi
Keyword(s):  
Financial Performance ◽  
Performance Indicators ◽  
Commercial Banks ◽  
Banking Sector ◽  
Financial Time Series ◽  
Capital Adequacy ◽  
Macroeconomic Factors ◽  
Determinant Factors ◽  
Net Interest Margin ◽  
Asset Quality

The purpose of this study is to elaborate whether the determinants of commercial banks’ profitability affect the financial performance of commercial banks in Kosovo. Performance evaluation of commercial banks in Kosovo is done through measurement of financial performance indicators such as Return on Average Equity (ROAE), Return on Average Assets (ROAA) and Net Interest Margin (NIM). The study identifies the main factors that affect the profitability of commercial banks through analysis of financial time series and panel data of the banking sector in Kosovo. The study presents three models of financial performance analysis which highlight the influencing factors. The models are based on regression analysis, and the obtained results emphasize the relationship between the determinant factors of commercial banks profitability expressed through analysis of financial performance indicators. The study concludes that commercial banks profitability in Kosovo is driven mainly by internal determinant factors such as capital adequacy, asset quality and management efficiency, while macroeconomic factors have insignificant impact on financial performance of commercial banks.

scholarly journals Antecedents of Financial Performance of Banking Sector: Panel Analysis of Islamic, Conventional and Mix Banks in Pakistan

2015 ◽  
Vol 1 (1) ◽  
pp. 9-30 ◽  
Author(s):  
Irum Saba ◽  
Rabia Kibriya ◽  
Rehana Kouser
Keyword(s):  
Banking Sector ◽  
Banking System ◽  
Fixed Effect Model ◽  
Least Square ◽  
Panel Regression ◽  
Internal Factors ◽  
Bank Profitability ◽  
Return On Equity ◽  
Asset Quality ◽  
Macroeconomic Determinants

Objective: This paper analyzes bank-specific, industry-specific and macroeconomic determinants of bank profitability on the sample of 25 banks, 161 observations on the Pakistani banking system in the period between 2006 and 2012. Our dependent variables include Return on Equity, Return on Assets and Earning per Share and independent variables consist of 'bank-specific determinants', industry-specific determinants', and 'macroeconomic determinants'. State Bank of Pakistan provides the data for internal factors on a yearly basis. Methodology: Different statistical techniques are used step by step to empirically test the relationship between the variables and to draw conclusions from the results of the study. Firstly, to analyze the features of the profitability determinants descriptive statistics are used. Secondly, we examine the causal relationship between bank-specific, industry specific, macroeconomic variables and profitability variables, Pearson's coefficient of correlation is used.  Panel data are used in this study so the technique used for regression is a panel regression technique which includes the pooled Ordinary Least Square, Random Effects Model and Fixed Effect Model. Hausman test is used to analyze that which technique for panel regression is more suitable for study. Results: According to the obtained results, among internal factors of bank profitability, firm size are the most important factor. Profitability is influenced by liquidity, asset quality and leverage condition of the banks. Regarding the external variables, inflation and interest rate show significant effect on bank profitability. Islamic banks show significant positive relationship with commercial banks.

scholarly journals PENGARUH CAR, BOPO, NPL, NIM, DAN LDR TERHADAP ROA PADA PERUSAHAAN DI SEKTOR PERBANKAN YANG TERDAFTAR DI BEI PERIODE 2012-2016

2019 ◽  
Author(s):  
Redwal Fernando ◽  
Aminar Sutra Dewi
Keyword(s):  
Regression Analysis ◽  
Multiple Regression Analysis ◽  
Multiple Regression ◽  
Commercial Banks ◽  
Stock Exchange ◽  
Capital Adequacy ◽  
Net Interest Margin ◽  
Capital Adequacy Ratio ◽  
The Relationship ◽  
Interest Margin

This study aims to examine the relationship between Capital Adequacy Ratio (CAR), Non Performing Loan (NPL), BOPO, Net Interest Margin (NIM), Loan to Deposit Ratio (LDR) for Return On Asstes (ROA). The number of samples used are 9 commercial banks listed on the Indonesia Stock Exchange period 2012-2016. The method used in this study using multiple regression analysis using Eviews 6. From the results of tests performed show that CAR statistically does not significantly influence tehadap ROA, BOPO significantly influence teh ROA, NPL has significant effect to ROA, different from NIM which has no significant effect on ROA, and LDR has significant effec on ROA.

Sign in / Sign up

Export Citation Format

Share Document