scholarly journals THE EFFECT OF MACROECONOMIC & BANK SPECIFIC FACTORS ON BANKS PROFITABILITY: AN EMPIRICAL EVIDENCE FROM BANKING INDUSTRY OF PAKISTAN

2020 ◽  
Vol 8 (3) ◽  
pp. 635-645 ◽  
Author(s):  
Khurram Sultan ◽  
Ramyar Rzgar Ahmed ◽  
Fairoz Mohammad Ameen ◽  
Mamta Singh
Keyword(s):  
Banking Sector ◽  
Positive Impact ◽  
Research Work ◽  
Economic Factor ◽  
Capital Adequacy ◽  
Secondary Source ◽  
Risk Capital ◽  
Negative Effect ◽  
Asset Size ◽  
The Impact

Purpose of the study: In the emerging environment of the banking sector, profitability is the main principle of the banks.The objective of this study to scrutinize the impact of banks on specific indicators such as asset size, credit risk, capital adequacy, and macroeconomic indicator such as the interest rate on the profitability of banks. Profitability is usually shown as a function of internal and external determinants. Methodology: To consider the determinants of bank’s profitability panel data has been used from 2003 to 2018 which belongs to 17 commercial banks for VIF, LSDVM, and Hausman test. The data is collected from the secondary source through financial reports of the banks. The dependent variable is ROE and the independent variables are in two categories bank-Specific variables and macroeconomic variables and analysis has been carried out in E-views software. Main Findings: The results reveal that the micro-economic factors that are deposits, asset quality, asset size, and liquidity have a significant impact on the bank’s profitability. While macro-economic factor gross domestic product (GDP) has a positive impact on the bank’s efficiency. However capital adequacy ratio, inflation has a negative effect on the bank’s profitability. Ours inspects give the conclusion that the bank's profitability being resolute by the significantly considered the above factors. Application of this study: This study contributes toward the banking sector for policymakers in order to construct the best capital configuration of the firm. This study also suggests that which element is having more importance while making capital configuration for the firm. The originality of this study: Profitability is usually shown as a function of internal and external determinants. The number of studies is available related to other industries but fewer studies are available related to the banking sector of Pakistan so this research work provides the technique while making the best profitability configuration for banks of Pakistan.

scholarly journals DETERMINANTS OF COMMERCIAL BANKS PROFITABILITY: EVIDENCE FROM GERMANY

2021 ◽  
Vol 13 (2) ◽  
pp. 82-88
Author(s):  
Szilard Farkasdi ◽  
Budi Septiawan ◽  
Erik Syawal Alghifari
Keyword(s):  
Regression Analysis ◽  
Commercial Banks ◽  
Banking Sector ◽  
Capital Adequacy ◽  
Dominant Factor ◽  
Significant Positive Effect ◽  
Interest Income ◽  
Negative Effect ◽  
Asset Size ◽  
Positive Effect

This study aims to determine the determinants of profitability in commercial banks in Germany. The population is 7 banking sector companies listed in the DAX (Deutscher Aktienindex) Bank during the 2017-2020 period, with a sample of 5 banks and producing 20 observational data. The method used is descriptive and verification with multiple regression analysis. The results show that asset size, capital adequacy, deposits and non-interest income have a significant positive effect on profitability. Partially, asset size, capital adequacy and non-interest income have a significant positive effect, while the deposit has a significant negative effect on profitability. The most dominant factor affecting profitability is non-interest income.

scholarly journals Comparing the Influence of Green Credit on Commercial Bank Profitability in China and Abroad: Empirical Test Based on a Dynamic Panel System Using GMM

2019 ◽  
Vol 7 (4) ◽  
pp. 64 ◽  
Author(s):  
Song ◽  
Deng ◽  
Wu
Keyword(s):  
Commercial Banks ◽  
Banking Sector ◽  
Empirical Test ◽  
Generalized Method Of Moments ◽  
Capital Adequacy ◽  
Dynamic Panel ◽  
Bank Profitability ◽  
Dynamic Panel Model ◽  
Asset Size ◽  
The Impact

This study establishes a dynamic panel model for 12 Chinese-listed commercial banks and seven international commercial banks. More specifically, it examines the impact of green credit on the profitability of commercial banks and the differences between China and other countries while using the generalized method of moments. The research shows that the Equatorial Principles project-financing ratio of international banks positively affects bank profitability, while the ratio of green credit for Chinese commercial banks is inversely related to their profitability. Further, a comparative study of China and other countries highlights that the green credit business is at significantly different stages in China and the rest of the world. This study also finds that the profitability of China’s banking sector is positively affected by asset size, management expense ratio, cash ratio, and GDP growth rate, in addition to the common influencing factor of non-performing loan ratio, whereas asset size and capital adequacy ratio negatively affects the international banking sector. Drawing on these empirical conclusions, this study offers suggestions for the further development of green credit in Chinese commercial banks.

scholarly journals Restructuring of the Banking Sector Through Merger: Case of Tunisian Banks

2021 ◽  
Vol 8 (2) ◽  
pp. 22
Author(s):  
Manel Bekri
Keyword(s):  
Banking Sector ◽  
Positive Impact ◽  
Principal Component ◽  
Economic Factor ◽  
Influential Factor ◽  
Documentary Analysis ◽  
Merger Process ◽  
Local Companies ◽  
Acquisition Processes ◽  
The Impact

In the classical economy, the business is always looking for growth. It tries to protect itself against disappearance and to enter new markets to ensure its growth. It resorts to the merger or the takeover of local companies to more easily solve certain problems. Development today by M&A is the most popular mode. In the context of merger acquisition processes, and its relationship with organizational, process, strategic, economic, political and cultural factors, our paper is designed to study the impact of these various factors on the merger-acquisition.To understand these relationships, we used principal component analysis, ANOVA analysis and multiple regression. A questionnaire was designed on the basis of a documentary analysis leading to the collection of 80 observations, collected from functionaries in the Tunisian banking sector during the period 16 December to 6 January 2016.The results show that the various factors have a positive impact on the success of the merger acquisition operation. It should be noted that the organizational factor is the most influential factor on the acquisition merger process and the least influential economic factor.

scholarly journals Restructuring of the Banking Sector through Merger: Case of Tunisian Banks

2020 ◽  
Vol 03 (11) ◽  
Author(s):  
Bekri Manel ◽  
Keyword(s):  
Banking Sector ◽  
Positive Impact ◽  
Principal Component ◽  
Economic Factor ◽  
Influential Factor ◽  
Documentary Analysis ◽  
Merger Process ◽  
Local Companies ◽  
Acquisition Processes ◽  
The Impact

In the classical economy, the business is always looking for growth. It tries to protect itself against disappearance and to enter new markets to ensure its growth. It resorts to the merger or the takeover of local companies to more easily solve certain problems. Development today by M&A is the most popular mode. In the context of merger acquisition processes, and its relationship with organizational, process, strategic, economic, political and cultural factors, our paper is designed to study the impact of these various factors on the merger-acquisition. To understand these relationships, we used principal component analysis, ANOVA analysis and multiple regression. A questionnaire was designed on the basis of a documentary analysis leading to the collection of 80 observations, collected from functionaries in the Tunisian banking sector during the period 16 December to 6 January 2016.The results show that the various factors have a positive impact on the success of the merger acquisition operation. It should be noted that the organizational factor is the most influential factor on the acquisition merger process and the least influential economic factor.

scholarly journals PENGARUH VARIABEL RASIO KEUANGAN DAN MAKROEKONOMI TERHADAP PEMBERIAN KREDIT SEKTOR UMKM OLEH PERBANKAN DI INDONESIA

2018 ◽  
Vol 9 (2) ◽  
pp. 253
Author(s):  
Raden Ai Lutfi Hidayat
Keyword(s):  
Interest Rate ◽  
Banking Sector ◽  
Random Effect ◽  
Random Effect Model ◽  
Capital Adequacy ◽  
Working Capital ◽  
Operating Income ◽  
Macroeconomic Variables ◽  
Negative Effect ◽  
The Impact

<em>The purpose of this study is to investigate the impact of financial ratios and macroeconomic variables toward SME’s credit on banking sector in Indonesia. In this research, financial ratio variables are the capital adequacy ratio, non performing loan, operating expenses per operating income, third party fund, return on assets, and business credit program. Macroeconomic variables is inflation, the gross domestic product, interest rate of working capital, and interest rate of investment. The research’s samples are banks in Indonesia that are divided based on their types in the period of 2004-2014. The method uses panel data multiple linear regression with random effect model. The results of this study are that CAR, NPL, and BOPO has a significantly negative effect on SME’s credit; DPK, ROA, KUR, inflation, and GDP have a significantly positive effect on SME’s credit. Interest rate of working capital has a significantly negative effect on SME’s credit and interest rate investments do not have a significantly effect on SME’s credit.</em>

The Impact of Competitive Quasi-Market on Service Delivery in Benue State University, Makurdi Nigeria

GIS Business ◽  
2019 ◽  
Vol 14 (4) ◽  
pp. 85-98
Author(s):  
Idoko Peter
Keyword(s):  
Service Delivery ◽  
A Priori ◽  
Least Square ◽  
Secondary Source ◽  
State University ◽  
Ordinary Least Square ◽  
Negative Effect ◽  
The Impact ◽  
The Relationship

This research the impact of competitive quasi market on service delivery in Benue State University, Makurdi Nigeria. Both primary and secondary source of data and information were used for the study and questionnaire was used to extract information from the purposively selected respondents. The population for this study is one hundred and seventy three (173) administrative staff of Benue State University selected at random. The statistical tools employed was the classical ordinary least square (OLS) and the probability value of the estimates was used to tests hypotheses of the study. The result of the study indicates that a positive relationship exist between Competitive quasi marketing in Benue State University, Makurdi Nigeria (CQM) and Transparency in the service delivery (TRSP) and the relationship is statistically significant (p<0.05). Competitive quasi marketing (CQM) has a negative effect on Observe Competence in Benue State University, Makurdi Nigeria (OBCP) and the relationship is not statistically significant (p>0.05). Competitive quasi marketing (CQM) has a positive effect on Innovation in Benue State University, Makurdi Nigeria (INVO) and the relationship is statistically significant (p<0.05) and in line with a priori expectation. This means that a unit increases in Competitive quasi marketing (CQM) will result to a corresponding increase in innovation in Benue State University, Makurdi Nigeria (INVO) by a margin of 22.5%. It was concluded that government monopoly in the provision of certain types of services has greatly affected the quality of service experience in the institution. It was recommended among others that the stakeholders in the market has to be transparent so that the system will be productive to serve the society effectively

Analysis of Financial Performance of Public Sector Banks in India: CAMEL

2020 ◽  
pp. 097674792096686
Author(s):  
Yudhvir Singh ◽  
Ram Milan
Keyword(s):  
Public Sector ◽  
Banking Sector ◽  
Positive Impact ◽  
Secondary Data ◽  
Capital Adequacy ◽  
Factors Affecting ◽  
Public Sector Banks ◽  
The Government ◽  
And Performance ◽  
Asset Quality

Public sector banks have been merged by the government in the last few years. This is the rationale behind conducting this study. The purpose of this article is to determine the factors affecting the performance of public sector banks in India and the interrelationship between bank-specific determinants and performance of public sector banks. In this article, we shall analyse the financial data of all the public sector commercial banks for a period spread across 11 years (2009–2019); Capital adequacy, Assets quality, Management efficiency, Earning, and Liquidity (CAMEL) has been used as a performance determinant; system generalised method of moments (GMM) analysis has been used to find the effect of determinants on the performance measurement of public sector banks; and CCA (canonical correlation analysis) has been used to find the interrelationship between the bank-specific determinants and the performance of public sector banks. The finding has important implications in terms of performance in the banking sector. Certain limitations of this study are: It is based on secondary data. The study only covers the financial aspects and not the non-financial aspects. It is found that the asset quality is negatively related with performance of public sector banks. Liquidity and inflation are inversely related to performance of public sector banks in India. Capital adequacy is positively related with banks’ performance, but inversely related with banks’ interest margin. GDP growth has a significant positive impact on banks’ performance, but inversely related with banks’ interest income. Inflation rate is inversely related with banks’ performance. Banking sector reforms are insignificantly related with banks’ performance.

The Impact of Employee Empathy on Brand Trust in Organizational Complaint Response Emails: A Closer Look at Linguistic Realization

2021 ◽  
pp. 232948842110323
Author(s):  
Rebecca Van Herck ◽  
Sofie Decock ◽  
Bernard De Clerck ◽  
Liselot Hudders
Keyword(s):  
Positive Impact ◽  
Brand Trust ◽  
Mediating Effects ◽  
Customer Complaints ◽  
Moderation Effects ◽  
Complaint Handling ◽  
Negative Effect ◽  
Handling Quality ◽  
The Impact

This study investigates the effect of linguistic realizations of employee empathy (LREE) on brand trust in email responses to customer complaints. We explore possible mediating effects of perceived empathy and perceived complaint handling quality and we look into moderation effects of compensation (Study 1) or customer’s acceptance of blame (Study 2). Our aim is to find out if LREE have a negative or positive impact on the customer in cases of partial refunds, either because LREE are being perceived as insincere or as genuine expressions of concern. The results of two experiments show that LREE positively influence brand trust through higher perceived empathy and perceived complaint handling quality. However, the expected negative effect is not found, as LREE are more effective in a low versus high compensation condition. The effectiveness itself is not influenced by the acceptance of blame when a partial refund is offered.

scholarly journals Does the target market affect bank performance? Evidence from the geographic diversification of city commercial banks in China

2021 ◽  
Vol 15 (1) ◽  
Author(s):  
Xiaonan Li ◽  
Chang Song
Keyword(s):  
Commercial Banks ◽  
Banking Sector ◽  
Capital Adequacy ◽  
Bank Performance ◽  
Chinese Government ◽  
Target Market ◽  
Geographic Diversification ◽  
Cross Sectional ◽  
The Impact ◽  
Geographical Diversification

AbstractAfter the opening up of the banking sector to domestic and foreign capitals which is approved by the Chinese government, the China Banking Regulatory Commission (CBRC) has permitted city commercial banks to diversify geographically. Since this deregulation in 2006, city commercial banks began to geographically diversify to occupy the market and acquire more financial resources. To examine the causal relationship between geographical diversification and bank performance, we construct an exogenous geographical diversification instrument using the gravity-deregulation model and a policy shock. We find that bank geographical diversification negatively affects bank performance. Moreover, we conduct some mechanism tests in the Chinese context. We find that the target market with several large- and medium-sized banks and a high level of local protectionism in the target market decreases the performance of city commercial banks. Finally, cross-sectional analyses show that the impact of geographical diversification on banks’ performance is more notable among city commercial banks that are younger, and have a lower capital adequacy ratio and a higher non-performing loan ratio.

scholarly journals Assessing the Impact of Corporate Governance Index on Financial Performance in the Romanian and Italian Banking Systems

2021 ◽  
Vol 13 (10) ◽  
pp. 5535
Author(s):  
Marco Benvenuto ◽  
Roxana Loredana Avram ◽  
Alexandru Avram ◽  
Carmine Viola
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Banking Sector ◽  
Research Question ◽  
Interactive Effect ◽  
Banking System ◽  
Capital Adequacy ◽  
Banking Systems ◽  
Governance Index ◽  
The Impact

Background: Our study aims to verify the impact of corporate governance index on financial performance, namely return on assets (ROA), general liquidity, capital adequacy and size of company expressed as total assets in the banking sector for both a developing and a developed country. In addition, we investigate the interactive effect of corporate governance on a homogenous and a heterogeneous banking system. These two banking systems were chosen in order to assess the impact of corporate governance on two distinct types of banking system: a homogenous one such as the Romanian one and a heterogeneous one such as the Italian one. The two systems are very distinct; the Romanian one is represented by only 34 banks, while the Italian one comprises more than 350 banks. Thus, our research question is how a modification in corporate governance legislation is influencing the two different banking systems. The research implication of our study is whether a modification in legislation, thus in the index of corporate governance, is feasible for two different banking sectors and what the best ways to increase the financial performance of banks are without compromising their resilience. Methods: Using survey data from the Italian and Romanian banking systems over the period 2007–2018, we find that the corporate governance has a significant, positive and long-lasting effect on profitability and capital adequacy in both countries. Results: Taking the size of the company into consideration, the impact of the Index of Corporate Governance (ICG) on a homogenous banking system is positive while the impact on a heterogeneous banking system is negative. Conclusions: Our study provides evidence of the impact of IGC on financial performance and sheds light on the importance of the size of the company. Therefore, one can state that the corporate governance principles applied do not encourage the growth of large banks in heterogeneous banking sectors, thereby suggesting new avenues of research associated with new perspectives.

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