BANK’S PERFORMANCE AND ITS DETERMINANTS – EVIDENCE FROM MIDDLE EAST, INDIAN SUB-CONTINENT AND AFRICAN BANKS
Journal Title: Polish Journal of Management Studies - Year 2018, Vol 17, Issue 1
Abstract
This study is driven by a motivation to examine the key determinants of bank’s performance as proxied by bank’s liquidity (LR), non-performing loans (NPL), capital adequacy ratio (CAR), loan growth (FEXP) and default risk premium (FQL) within the framework of credit creation theory of banking. Using random effect model as an estimation tool on 93 banks in Middle East, Africa and Indian subcontinent over study period from 2009 through 2016, the findings reveal that there are significant relationships between bank’s performance and its loan growth. Both ROA and FEXP are also found to be positively correlated. In contrast, the NPL and CAR are found to be negatively correlated with ROA. As a whole, it is evident that loan growth plays a very important role in supporting bank’s long term performance.<br/><br/>
Authors and Affiliations
Abdul Razak Abdul Hadi, Hafezali Iqbal Hussain, Tulus Suryanto, Eddy Yap
Keywords
Related Articles
- EP ID EP305870
- DOI 10.17512/pjms.2018.17.1.02
- Views 92
- Downloads 0
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