Impact of Bank Specific Factors on Profitability of Nepalese Commercial Banks

Hakuduwal, Kishor

doi:10.3126/tuj.v36i01.43587

Cited by 6 publications

(10 citation statements)

References 12 publications

(30 reference statements)

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“…Research conducted by Lima [22], Hakuduwal [13] and Saif-Alyousfi [32] showed a positive significant effect between liquidity on bank profitability. On the other hand, Nayagar [27] and Mercan et al [25] showed a negative significant effect between liquidity and profitability.…”

Section: Literature Reviewmentioning

confidence: 92%

“…Adequate liquidity enables banks to meet their financial obligations and customer demands effectively [22]. Studies have shown both positive significant effects Lima [22], Hakuduwal [13] and Saif-Alyousfi [32] and negative significant effects Nayagar [27] and Mercan et al [25] Referring to previous studies that have shown both positive significant effects and negative significant effects of liquidity on bank profitability. Further analysis is required to determine the specific relationship in the context of Egyptian private banks.…”

Section: Literature Reviewmentioning

confidence: 97%

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The dynamics behind private banking growth in Egypt

Abdou,

Alarabi

2024

Futur Bus J

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The research investigates the determinants of private banks profitability in Egypt. The determinants are bank specific (liquidity, capital adequacy, bank size, asset structure, credit risk, and non-performing loans), industry-specific (industry concentration and banking industry development), and macroeconomics (economic growth and inflation). It is an empirical study applying a quantitative method for data analysis and the type of data is secondary data. The sample size of the research is 15 private banks on the Egyptian and the panel data for the research is 2013–2022. The multiple linear regression analysis using the Eviews 12 application as an analytical tool by applying generalized least squares model. The profitability of private banks, which is the dependent factor, is calculated by two measurements, Return on Assets and Return on Equity with ten determinants of profitability as independent variables. Results indicate that capital adequacy, economic growth bank size, and inflation has a positive significant effect on private banks profitability in Egypt. While NPL, liquidity and credit risk have significant negative effect on private banks profitability in Egypt. Based on the results recommendations are provided for bank management to maximize their profitability.

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Section: Literature Reviewmentioning

confidence: 92%

Section: Literature Reviewmentioning

confidence: 97%

The dynamics behind private banking growth in Egypt

Abdou,

Alarabi

2024

Futur Bus J

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“…This study employs a descriptive and causal comparative research design. Unlike previous studies that concentrated on comparative financial analysis related to factors like capital adequacy, debt-to-equity, equity ratio, and bank profitability, this research explores the influence of internal factors on the performance of Nepalese commercial banks, considering variables such as costto-income ratio, liquidity position, nonperforming loans, asset quality, capital adequacy, bank size, and profitability (Bhattarai, 2020): (Mishra et al, 2021): (Hakuduwal, 2021).…”

Section: Literature Reviewmentioning

confidence: 99%

Examination of Specific Factors of the Form Affecting Profitability of Commercial Banks: A Case from Nepal

Mishra,

Kandel

2023

VEETHIKA

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This study investigates the determinants of operational performance in Nepalese commercial banks, with a particular focus on the roles of capital adequacy, cost-to-income ratio, and various performance indicators. The study underscores the pivotal role of maintaining an optimal level of capital adequacy and cost-to-income ratio in shaping the profitability of commercial banks.Bank size, nonperforming loans ratio, liquidity position, cost-to-income ratio, capital adequacy, and assets quality all exhibit a positive impact on overall bank performance. Prudent management of capital adequacy and cost-to-income ratio emerges as key factors influencing profitability. Analysis with one-year lagged variables reaffirms the significance of liquidity ratio, capital adequacy, and increased capital ratio in enhancing bank performance, particularly in terms of return on assets. An improved assets quality also contributes to overall bank performance. Effective liquidity management is crucial, emphasizing considerations of liquidity ratio, capital-to-assets ratio, investment-to-asset ratio, and quick ratio. Commercial banks are advised to operate within a threshold level of capital ratio, avoiding excessively high levels that may negatively impact profitability. The study recommends investing in well-trained manpower to enhance operational efficiency and customer service. In the broader economic context, the study highlights the vital role of banks in contributing to the country's development. It calls for strong supervision, monitoring, and the implementation of a one-window service in lending and investment activities. Commercial banks are encouraged to demonstrate their potential contribution to the national economy by ensuring a satisfactory rate of return on investment, efficient mobilization of savings, and strategic competitiveness

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“…The study found that firm size, dividend per share, and earnings per share had a positive impact, while return on equity and dividend yield had a negative influence. Katuwal (2021) added to the knowledge pool, emphasizing the relevance of earnings per share and book value per share in explaining stock prices among Nepalese commercial banks, underscoring the role of these fundamental variables in stock pricing dynamics.…”

Section: Literature Reviewmentioning

confidence: 99%

Factors Influencing Stock Prices in Commercial Banks of Nepal

Joshi,

Ghimire,

Singh

2023

KMC Res. J.

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This study explores the factors that influence stock prices in commercial banking business in Nepal. Descriptive and causal-comparative research design and purposive sampling technique used in this research examine how critical financial variables affect market prices per share (MPPS), including book value per share, earnings per share, dividend per share, and price-earnings ratio. There is a statistically significant but relatively small positive correlation between book value per share. The results show that MPPS and earnings per share, dividend per share, and price-earnings ratio are significantly positively correlated. The model demonstrates its robustness in capturing stock price changes by accounting for around 86.1% of the variation in MPPS. These observations offer insightful recommendations for experts and investors involved in Nepal's commercial banking sector.

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Impact of Bank Specific Factors on Profitability of Nepalese Commercial Banks

Cited by 6 publications

References 12 publications

The dynamics behind private banking growth in Egypt

The dynamics behind private banking growth in Egypt

Examination of Specific Factors of the Form Affecting Profitability of Commercial Banks: A Case from Nepal

Factors Influencing Stock Prices in Commercial Banks of Nepal

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