Dividend Policy, Share Price and Future Profitability: Case of Commercial Banks in Nepal

<p>The study analyzes the impact of dividend policy on share price and future profitability of commercial banks in Nepal. Using panel secondary data of 13 commercial banks from year 2001 to 2014, correlation and regression analysis are applied for the study. The impact of dividend policy on share price is analysed first and the findings of initial analysis suggests that dividend yield and retention ratio have significant negative impact, whereas earning per share has significant positive impact on share price. The study, thus, supports the dividend relevance in Nepalese capital market, and it is further extended to analyze whether dividend changes carried any special information influencing future profitability of commercial banks in two subsequent year of dividend declaration. The conclusion from the analysis indicates that the current year dividend change has significant impact on current year earning changes. For subsequent years, the impact of dividend change is insignificant. Thus, dividend change does not carry information regarding changes in earning in subsequent years of dividend declaration and does not support signalling hypothesis in Nepalese capital market.</p><p>Journal of Business and Social Sciences Research, Vol. 1, Issue 1, pp. 89-110</p>

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Pengaruh Dimensi Kualitas Pelayanan Terhadap Loyalitas Penumpang Trans Padang

Jurnal Ecogen ◽

10.24036/jmpe.v3i4.10501 ◽

2020 ◽

Vol 3 (4) ◽

pp. 562

Author(s):

Aris Agung Wicaksono ◽

Okki Trinanda

Keyword(s):

Data Analysis ◽

Sample Size ◽

Negative Impact ◽

Positive Impact ◽

Secondary Data ◽

Total Sample ◽

Analysis Method ◽

Significant Negative Impact ◽

In Trans ◽

The Impact

The aim of this study was to determine the impact of service quality in passenger retention in Trans Padang. These researchs were descriptive and quantitative. The study consist of residents in Padang, who frequently use the Trans Padang Pasar Raya – Lubuk Buaya route. The data used were primary and secondary data. We used questionnaires and documents. The sample of this technique was a targeted sample with a total sample size of 100 respondents. This analysis method had been use repeatedly with SPSS version 23 regrression analysis. The hypothesis study uses in this data analysis such as validation, reliability, normality, multicollinearity, heterogeneity, F-test, and T-statistic test at a = 0.05. the result of this study show that 1)Reliability had a significant negative impact on passenger loyality in Trans Padang. 2)Responsibility had a significant positive impact on the loyality of Trans Padang. 3)assurance had a significant positive impact on the loyality of Trans Padang. 4) Empathy had a significant positive impact on the loyality of Trans Padang. 5)Tangible had a significant negative impact on the loyality of Trans Padang passengers.Keywords : reliability, responsiveness, assurance, empathy, tangible and loyalty

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Effect of Income Diversification on Risk-Adjusted Profitability of Commercial and Development Banks in Nepal

Journal of Business and Social Sciences Research ◽

10.3126/jbssr.v4i2.29482 ◽

2019 ◽

Vol 4 (2) ◽

pp. 35-51

Author(s):

Rubina Prajapati ◽

Ajay Kumar Shah

Keyword(s):

Regression Analysis ◽

Commercial Banks ◽

Negative Impact ◽

Positive Impact ◽

Debt Ratio ◽

Income Diversification ◽

Interest Income ◽

Significant Negative Impact ◽

Development Banks ◽

The Impact

This study analyses the impact of income diversification on risk adjusted profitability of commercial and development banks in Nepal. Risk adjusted profitability is measured in terms of risk adjusted return on assets (RAROA) and risk adjusted return on equity (RAROE). The regression analysis shows Herfindahl Hirschman Index (HHI), equity multiplier, non-interest income and foreign holding have significant positive impact on RAROE of commercial banks. Whereas the size of commercial banks has a significant negative impact on RAROE. There is a significant positive impact of HHI, non-interest income on RAROA in case of commercial banks. Size of commercial banks also has a significant negative impact on RAROA. Debt ratio does not have significant impact in case of RAROE of commercial banks and equity multiplier, debt ratio and foreign holding do not have significant impact on RAROA of commercial banks. The regression analysis of development banks showed there is significant positive impact of HHI and equity multiplier on RAROE of development banks. The study concludes that income diversification, non-interest income and size of the commercial banks are the major determinants of risk adjusted profitability of commercial banks.

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IMPACT OF CREDIT RISK ON PROFITABILITY OF COMMERCIAL BANKS IN NEPAL

Journal of Applied and Advanced Research ◽

10.21839/jaar.2018.v3i6.230 ◽

2018 ◽

Vol 3 (6) ◽

pp. 161

Author(s):

Shiva Raj Poudel

Keyword(s):

Credit Risk ◽

Commercial Banks ◽

Negative Impact ◽

Positive Impact ◽

Panel Data Analysis ◽

Fixed Effect Model ◽

Capital Adequacy ◽

Return On Equity ◽

Significant Negative Impact ◽

The Impact

The main purpose of the study was to examine the impact of credit risk on profitability of the commercial banks in Nepal. Data were collected from the sample of 15 commercial banks operated in Nepali economy for the period of 2002/03 to 2014/15. One way Fixed Effect Model (FEM) of panel data analysis is used as a major tool of analysis. The profitability of the commercial banks is measured in terms of return on equity and is regressed on bank specific variables and macro-economic variables. The results confirmed that credit risk has the significant negative impact on profitability of commercial banks in Nepal. In addition, solvency ratio, interest spread rate, and inflation have the insignificant negative impact on profitability. In contrast, capital adequacy ratio, total assets, and GDP growth have the significant positive impact on profitability of commercial banks in Nepal. Finally, inter-bank interest rate has insignificant positive impact on profitability.

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Dividend Policy and Share Price volatility: Evidence From Pakistan Stock Exchange of Listed Commercial Banks

Issues in Economics and Business ◽

10.5296/ieb.v5i1.14769 ◽

2019 ◽

Vol 5 (1) ◽

pp. 35

Author(s):

Laeeq Ahmad ◽

Yasir Iftikhar ◽

Sarmad Ejaz ◽

Waqas Baig ◽

Kashif Nadeem ◽

...

Keyword(s):

Commercial Banks ◽

Dividend Policy ◽

Negative Impact ◽

Positive Impact ◽

Stock Exchange ◽

Market Price ◽

Price Volatility ◽

Share Price ◽

Retention Ratio ◽

Return On Equity

This study examines the all possible dividend policy effect on commercial banks stock price listed at Pakistan stock exchange. The study covers 17 listed commercial banks for the time period 2014 to 2017. To analyze secondary data multiple regression analysis was applied using Stata with the model (MP) Market Price Per Share as the dependent variable and (EPS) Earning Per Share, (ROE) Return on Equity, (RR) Retention Ratio and (DY) Dividend Yield are independent variables. Descriptive statistics were applied to data to check mean, median, maximum and minimum value. The finding of the study shows that EPS shows a highly significant positive impact on the share MP and the other three independent variable return on equity, dividend yields, and retention ratio also show a significant but negative impact on the share MP. These results support the finding of previous studies done by another researcher in the past.

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The Impact of the Business Environment on the Formalization of Informal Firms. The Case of Kosovo

Südosteuropa ◽

10.1515/soeu-2020-0035 ◽

2020 ◽

Vol 68 (4) ◽

pp. 505-529

Author(s):

Kujtim Zylfijaj ◽

Dimitar Nikoloski ◽

Nadine Tournois

Keyword(s):

Negative Impact ◽

Positive Impact ◽

Business Environment ◽

Positive Influence ◽

Policy Implications ◽

Tax Reforms ◽

Firm Level ◽

Characteristics Analysis ◽

Significant Negative Impact ◽

The Impact

AbstractThe research presented here investigates the impact of the business environment on the formalization of informal firms, using firm-level data for 243 informal firms in Kosovo. The findings indicate that business-environment variables such as limited access to financing, the cost of financing, the unavailability of subsidies, tax rates, and corruption have a significant negative impact on the formalization of informal firms. In addition, firm-level characteristics analysis suggests that the age of the firm also exercises a significant negative impact, whereas sales volume exerts a significant positive impact on the formalization of informal firms. These findings have important policy implications and suggest that the abolition of barriers preventing access to financing, as well as tax reforms and a consistent struggle against corruption may have a positive influence on the formalization of informal firms. On the other hand, firm owners should consider formalization to be a means to help them have greater opportunities for survival and growth.

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Growth of Capital Market in Nepal: Impact on Capitalization, GDP and NEPSE Index

Saptagandaki Journal ◽

10.3126/sj.v11i0.36898 ◽

2020 ◽

Vol 11 ◽

pp. 66-83

Author(s):

Dhan Raj Chalise

Keyword(s):

Capital Market ◽

Significant Contribution ◽

Positive Impact ◽

Stock Exchange ◽

Secondary Data ◽

Secondary Market ◽

Financial Resources ◽

Descriptive Research ◽

The Impact ◽

The Capital Market

The capital market plays an importance role in an economy and provides the opportunity to the investor for the mobilization and channelization of funds. Nepalese capital market is in growing and improving phase. The objective of this study is to analyze the evaluation of the existing status of the capital market in term of its composition of types of the capital market and to examine the impact of capital mobilization in Gross Domestic Product (GDP) and to examine the contribution of capital market in financial resources and GDP. Besides, the study examines the share transaction in Nepal Stock Exchange (NEPSE) and its impact on NEPSE Index. The study period of 2000/01 to 2018/19 has been used for study purposes. Through the use of descriptive research design, the trends of capital market development track after 2000/01 to present status has been presented. Secondary data are analyzed through the use of regression and other descriptive statists to convert the information into data. The result indicates that the ordinary shares in the primary capital market and market capitalization in the secondary market has significant contribution for the capital market in Nepal. Also, the study reveals that there is a significant and positive impact of capital mobilization on GDP and the number of share transactions on the NEPSE Index in the Nepalese capital market. Hence there is a significant contribution of the capital market for financial resources mobilization and GDP of Nepal. The study reports for modernization and systematization of the capital market need more optimal efforts from concerned stakeholders.

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Determinants of Non-Performing Loan in Nepalese Commercial Banks

Economic Journal of Development Issues ◽

10.3126/ejdi.v19i1-2.17700 ◽

2017 ◽

pp. 22-38 ◽

Cited By ~ 1

Author(s):

Seema Bhattarai

Keyword(s):

Exchange Rate ◽

Commercial Banks ◽

Negative Impact ◽

Positive Impact ◽

Percent Level ◽

Real Effective Exchange Rate ◽

Macroeconomic Variables ◽

Effective Exchange ◽

Effective Exchange Rate ◽

The Impact

The non-performing loans (NPL) of financial institutions are considered as a significant issue in the context of Nepal for last few decades. The paper aims to identify the impact of macroeconomic variables (GDP, Inflation, and Real Effective Exchange Rate) and bank specific variables (size, change in loan, real lending rate of interest, and share of loan to total assets) on the non-performing loan of the commercial banks in Nepal. The study was conducted mainly with secondary sources. The data were collected for 26 commercial banks covering the period of 2002-2012 with 227 observations. The study found that macroeconomic variables such as the real effective exchange rate have significantly negative impact on non-performing loan. The impact of GDP growth rate was found to be insignificant in this study. One year lagged inflation rate has significant positive impact on non-performing loan. The banks which charge relatively higher real interest rate have higher non-performing loan, which is consistent with the findings of previous studies. The ownership dummy has positive coefficient and significant at one percent level showing that if the bank is government owned the non-performing loan would be higher than that of the private owned banks. As well, more lending in the previous years and current year reduces the non-performing loan since the coefficient of change in loan in current and previous years have negative coefficient and significant at one percent level.Economic Journal of Development Issues Vol. 19 & 20 No. 1-2 (2015) Combined Issue, Page: 22-38

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What Drives Bank Profitability? A Panel Data Analysis of Commercial Banks in Bangladesh

International Journal of Finance & Banking Studies (2147-4486) ◽

10.20525/ijfbs.v10i2.1236 ◽

2021 ◽

Vol 10 (2) ◽

pp. 96-110

Author(s):

Rana-Al-Mosharrafa ◽

Md. Shahidul Islam

Keyword(s):

Negative Impact ◽

Positive Impact ◽

Panel Data Analysis ◽

Mediation Effect ◽

Industry Concentration ◽

Equation Modeling ◽

Bank Profitability ◽

Macroeconomic Variables ◽

Significant Negative Impact ◽

The Impact

Bank profitability plays a significant role in the growth and development of an emerging economy. The purpose of the study was to examine the impact of bank characteristics, industry concentration and macroeconomics variables on commercial bank profitability in Bangladesh from 2007-2017. Bank profitability is proxied by return on assets (ROA), return on equity (ROE) and net interest margin (NIM). The study is based on secondary data and Hausman test has been performed using STATA software in favor of fixed effect modeling. Panel regressions shows that cost efficiency has significant negative impact on ROA and NIM. The positive impact of loan to deposit ratio with ROA suggests that efficient fund management including investment and assessed expenditure should be emphasized. Bank size has significant negative impact on all the measures of profitability, which indicates that monopolistic competition will reduce banking profit. Credit risk has significant positive impacts on ROE. Industry concentration measured by CR3 is positively related with ROE and has significant negative relation with bank profitability (ROA). Among macroeconomic variables inflation has significant positive and bank spread has significant negative impact on ROE. The coefficients of all the macroeconomic variables have been found to be significantly related to bank profitability while measured by NIM. Our study recommends further research with other explanatory variables such as, corporate governance, corporate social responsibility (CSR) and deposit insurance to accelerate the model and construct the econometric model by using structural equation modeling, mediation effect modeling etc.

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Impact of Corporate Governance on Dividend Policy: Evidence from Pakistan

Sustainable Business and Society in Emerging Economies ◽

10.26710/sbsee.v3i3.1989 ◽

2021 ◽

Vol 3 (3) ◽

pp. 353-366

Author(s):

Abdul Hameed ◽

Farheen Zahra Hussain ◽

Khawar Naheed ◽

Muhammad Sadiq Shahid

Keyword(s):

Corporate Governance ◽

Dividend Policy ◽

Negative Impact ◽

Positive Impact ◽

Stock Exchange ◽

Payout Policy ◽

Least Square ◽

Political Connection ◽

Dividend Payment ◽

The Impact

Purpose: The objective of the paper is to examine the impact of corporate governance on the dividend payout policy of firms listed on the Pakistan stock exchange during 2010-2020. As Pakistani investors face issues regarding their return in the shape of dividends and depend upon the firm’s corporate governance strength. To test whether changes in firm code of corporate governance have a significant influence on dividend policy. Design/Methodology/Approach: The panel data has been used for the period 2010-2020 and panel least square has been applied. Further, to test the association, following factors such delisting risk, government tenure, political connection with institutional shareholding as many political firms hold corporate shares which influence the decision to pay dividends. Findings: Findings from the fixed effect model show that corporate governance has a negative impact on dividend policy while government tenure, politically connected firm has a positive impact on the dividend. The study also concludes that firm size, profitability, tax, asset turnover, leverage, and firm shareholding also influence firm dividend payment behavior. Implications/Originality/Value: The implication of study reveals that firms must focus on strong their governance and include more independent directors on the board which leads to favorable strategies regarding investors. The investor must invest in those firm where lower political connection, pay continuous dividend either high or low decease/increase delisting chances, strong corporate governance and firm specific factors also lead to make decision of dividend payment.

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Scoring Models and Credit Risk: The Case of Cooperative Banks in Poland

Risks ◽

10.3390/risks9070132 ◽

2021 ◽

Vol 9 (7) ◽

pp. 132

Author(s):

Krzysztof Kil ◽

Radosław Ciukaj ◽

Justyna Chrzanowska

Keyword(s):

Statistical Data ◽

Negative Impact ◽

Positive Impact ◽

Review Of The Literature ◽

Management Board ◽

Panel Model ◽

Significant Negative Impact ◽

Cooperative Banks ◽

Lending Activity ◽

The Impact

The aim of the research presented in the article was to analyse the legitimacy of the use of scoring models in banking activities, together with the assessment of the effectiveness of this tool in reducing the high value of the NPL ratio in Polish cooperative banks on the example of banks belonging to the BPS S.A. association in the period between 2004 and 2020. We used a variety of research methods for this purpose including a depth review of the literature, analysis of statistical data regarding the sector of Polish cooperative banks, analysis of financial data of cooperative banks, construction of an econometric panel model, and the designing a questionnaire (which was later sent to the management board of selected cooperative banks). Our research confirmed the significant impact of the use of scoring models in lending activities on the value of the NPL ratio in cooperative banks. The analysed cooperative banks, which used the scoring models proposed by BIK in their lending activity, showed significantly lower values of the NPL ratio in each analysed year than banks that used other scoring models. Our study also confirmed the different direction of the impact of the models offered by BIK and individual scoring models on the value of the NPL ratio. We have also shown that the scoring models proposed by BIK have a statistically significant negative impact on the level of the NPL ratio, and the banks’ own scoring models have a statistically significant positive impact on the level of the NPL ratio.

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