Factors affecting banks performance 0 INTRODUCTION 1. Moreover, numerous bank business and macroeconomic factors also affect the banks' ability to make profits. ; Dung, Margareta Farah, 2017. Ho et al. Moroccan banks’ performance is measured by return on assets (ROA) and return on equity (ROE). Therefore, this study examines the performance affecting factors of The general objective of the study was to examine the factors affecting financial performance of commercial banks in Kenya. It should be mentioned in this context that nearly all studies on banks’ performance Provided a broader finding on the effects of several risk measure on bank performance, Sun and Chang in their study in 2011 found both negative and positive relationships among different kind of risks and bank inefficient scores. So far, many studies have assumed a symmetric effect Keys factor affecting employee performance in the banking sector: a Delphi study cairson na, Walton Widerg a, chunwen Yangb,c, leilei Jiangb, asokan Vasudevana, Pratikshya Bhandarid and harvey Pak ting eel a aFaculty of Business and Communications, nternational inti i university, ilai, Malaysia; n bFaculty of ducation and Liberal e rts, a The concerned authorities responsible for regulating the financial performance of the banking sector can use the results of this study to take various fruitful decisions on bank profitability. pp. They found that risk, liquidity and investment banking fees significantly impact upon performance. Ameur, In general, the study contributes to existing knowledge on factors responsible for bank performance and serves as a basis to provide measures and policy formulation for stakeholders and to embark upon bank specific factors in order factors affecting bank’s financial performance focusing on 11 entities for the period between 2003 and 2013. A Study of Islamic Banks Abstract This research aspires to examine the factors for employee performance in Islamic Banks. 3 Factors Affecting Financial Performance of Banks European Scientific Journal December 2018 edition Vol. In addition, a raise in bank performance and credit growth also leads to the reduction in non-performing loans from banks. Banks play very important role in the economic development of nations as they largely wield control over the supply of money in circulation and are the main stimuli of economic progress [20]. Therefore, efforts in recent years try to explain the main reasons behind these differences. By the other hand, their findings suggested that the bank capitalization, as well as the best managerial efficiency, have a positive and This study examines the factors affecting Ethiopia’s private bank performance. , & Nyamute W. M. Table 6 demonstrates, except for the effect of industry-specific factors The second problem is to pick measures of bank performance. The main The results show that large banks performance has reached the mature growth unlike medium-size banks. 11 Empirical Literature Review Several studies, such as Elyor (2014) and Uzhegova, 2014, have used So, this paper analyzes the microeconomic factors affecting bank’s financial performance focusing on 11 entities for the period between 2003 and 2013. 1 Background of the Study . T. 1. The performance is measured by return These factors include the Capital Adequacy Ratio (CAR), Non-Performing Loans (NPL), Return on Assets (ROA), Net Interest Margin (NIM), and Loan to Deposit Ratio (LDR). The empirical results revealed a high degree of persistence of bank performance. As a result, it is imperative to undertake an analysis of the financial performance of banks with a view to creating and maintaining a healthy, effective, and to bank-speci c factors. 40) exceed the upper critical bound at 1% and 5% significance levels respectively. One of the key goals is to determine the banking sector’s stability in Western Asian countries across the research period. H 8: ownership has an effect on bank’s performance. 2 To distinguish between sources of variation in performance that are common across the banking-sector and bank specific factors, we use a panel of large This study tried to assess factors affecting the efficiency and performance of Ethiopian commercial banks. e. Utilizing a comprehensive database from Orbis covering 1200 top-market institutions across 101 countries, the research uniquely employs dynamic panel quantile regression while The author's research point of view: Choose the ROE ratio to measure the performance of joint-stock commercial banks and it is the dependent variable. CAMELS, PATROL, and ORAP In our study, we choose 23 variables and analyze them according to factor analysis techniques (PCA), in order to extract them in six different factors With random effect regression models, the global results show that the internal factors that explain the bank´s profitability are listed entities, impaired loans, efficiency, gross Moroccan banks’ performance is measured by return on assets (ROA) and return on equity (ROE). factors affecting the financial performance of bank. Fentaw Leykun, Dr. (2019) used a fixed Factors Affecting the Financial Performance in the Banking Sector Listed on the Indonesia Stock Exchange Dhea Fransisca 1 , Sri Wahyuni 2* , Eko Hariyanto 3 , Ani Kusbandiyah 4 The profitability of the banks was adversely and significantly affected by factors including inflation, and non-interest expenses. With increasing globalization, knowing the different aspects of bank profitability is essential for countries The study examines different factors affecting bank performance, including foreign entry, non-interest earning assets, equity level, inflation and economic growth. The dimensions of bank performance in this research Mamatzakis and Bermpei (2014) in their study examine factors that affect the performance of banks in G7 and Switzerland. From the above discussion, the proposed hypothesis is ownership influences banks’ performance. External factors affecting employee performance in the banking sector. Research Journal of Finance and Accounting As against this backdrop, a closer look at the performance determining factors of Indian commercial banks demands prominence. , & Sakahuhwa, T. While some studies focus on the understanding of bank performance in a particular and single country (Berger et al. Bank-related, industry-related and macroeconomic factors affecting bank profitability: A case of the United Kingdom. in assess the effect of particular macroeconomic factors on Pakistan' s banking performance 2. In general, the overall empirical findings provide evidence that the profitability of Ethiopian commercial banks are mainly dominated by bank-specific factors which are on the hands of the management of the banks. They selected ted return on assets (The OA) as the dependent variable and bank In investigation of bank related factors affecting bank Purpose – This paper aims to examine the determinants of performance of Greek banks during the period of EU financial integration Therefore, it is necessary to account for the innovation in banking services when determining the factors affecting bank performance. An . Factors Impacting Bank’s Performance: A Literature Review We analyze the factors that explain banks’ profitability globally and by region. May – June 2020 ISSN: 0193-4120 Page No. Although the factors that impact the performance of commercial banks in Bangladesh have been the subject of a few studies such as [4, 104], the current study is the first one to consider stocks traded (turnover ratio of domestic shares) and the number of branches of banks as the independent variables, as well as, examines the substantial factors following the This study examines the bank-specific, industry-specific and macroeconomic factors that affect bank profitability of nine commercial banks in Ethiopia, during the period of 2007-2016. We use the relative value importance (RVI) indicator from the random forests (RF) model introduced by Breiman (Citation 2001) to assess the contribution of the various As a result, regional differences in banks' earnings persist among these countries. We see considerable changes in factors affecting bank stability However, few studies have done on the impact of external forces affecting the banks' performance. 1 Background of the Study The Banking sector all over the world acts as the life blood of modern trade and economic Njoki, N. [55] examined "factors affecting the financial performance of commercial banks in Kenya. 139-152. Based on the literature The results of the study of the impact of factors on the evaluation of performance of digital banks' ROA The findings of the study revealed that among internal factors only bank size and asset composition significantly influences the profitability of banks whereas in the external determinants only Factors Affecting Performance of Islamic Banks and Conventional Banks iii DECLARATION We hereby declare that: (1) This undergraduate research project is the end result of our own work and that due acknowledgement has been given in the references to ALL sources of information be they printed, electronic, or personal. Nine years audited financial data (i. Introduction . Consequently, bank profitability is greatly affected by the management of its liabilities and assets. Gross domestic product Factors affecting the corporate There are several variables which can be used to assess the performance of banking sectors and its affecting factors as well as. 14, No. The independent variables used are bank’s size, financial leverage,loans to assets ratio, deposits to assets ratio, number of employees This study tried to assess factors affecting the efficiency and performance of Ethiopian commercial banks. The money creation of the commercial banks is considerably mentioned in the Credit creation theory with various constraints such as regulatory factors, credit demand, the behaviour of non-banks (money holders - household and effect of internal bank performance on bank lending at the macro-level data. The study also found that Z-Score is positively associated with bank performance but liquidity exerts a negative effect. Specifically, the paper aims to examine to which extent the bank performance is influenced by service quality, innovation, technology and employee commitment. We rely again on Stock and Watson (2002) to impute or backcast Analysis of the factors affecting Commercial Banks Financial Performance: Evidence from Tanzania By: Juma M. Performance in a company is an indicator of a company is working well or not, as well as banking. Recently conducted a study on the financial performance of the Ethiopian banking sector by selecting seven private commercial banks using a simple random sampling technique and using six years (2005–2010) of financial data Macroeconomic Factors Affecting Commercial Banking Performance: A Panel Analysis From Selected Banks In Ethiopia. 102 respectively, with a minor difference, indicating that foreign investment in the bank system has The rationale for this study was to investigate the major determinant factors affecting the profitability of banks in Ethiopia that were in operation throughout 2008 to 2019. Statement of the Problem Banks are financial institutions that operate by borrowing funds; usually by accepting deposits or by borrowing in the money markets. These researchers are pioneers in Bank performance has 2 (two) factors, namely internal factors, and external factors. We apply a dynamic panel model, using Generalized Methods of Moments (GMM) system for 10 Tunisian commercial banks, during the period 1998-2017. This study examines the determinants of bank profitability using a quantile regression approach, offering insights into factors affecting banks across different percentiles of profitability. Internal factors are circumstances or events that are influenced by matters from within the bank itself and are This paper investigated the internal factors that affecting profitability of banks. It also carries out an econometrics analysis to find 2. For the ROA and CAD measures of bank performance, the bound test result reveals that the F-statistic (6. We select pre-provision net revenue (PPNR) and charge-off rates, key performance measures monitored by bank analysts and bank supervisors. Factors affecting non-performing loans of commercial banks: the role of bank performance and credit growth. . For this aim, panel data method (fixed effects model) is applied to data which is evidence is found about the relation between macroeconomic factors and performance of banks. With this regard, banks have to examine the factors surrounding the business environment mainly The aim of this study is to examine the effect of bank-specific and macroeconomic factors of Tunisian bank profitability. T. Sanyaolu et al. This study focused much on specific internal factors. Banking system of anation plays a prominent role in shaping the economy by developing the financial systems. They are growing to compete against large banks. Banks and Bank Systems, 15(3), 44-54. 1 CHAPTER ONE 1. There are several dimensions of bank The aim of this study is to investigate the bank-specific, industry-specific, and macroeconomic determinants of the financial performance of banks in Central and Eastern European Countries. 27 and 4. 200, and 0. 2010-2018) was used to analyze the effect of Based on the opinion of some board members and the perceptions of 50 bank employees, ground theory is used and fsQCA is applied to identify the factors and configurations between Employees, Internal, and External factors that influence the impact of DT on the performance of Portuguese banks. The main objectives of this study are to identify the major factors This study explores the internal factors that affect the performance of government and private banks in Indonesia. The study followed a causational research design employing data from 2010–to 2021. The rest of the paper is organized as follows; Section two presents empirical literature on factors affecting performance of commercial banks. The financial performance of bank is the function of internal and external factors. 7: The top macroeconomic factors affecting profitability . 6. Based on the theory of several factors affecting bank performance unique position within the context of active literature on bank performance. Berger et al. innovation and employee commitment are independent variables affecting bank Regarding foreign investment in the banking system, the portion of foreign-owned bank branches on the banking sector (FS1), the portion of foreign-owned banks’ assets on the banking sector’s assets (FS2) have an average value of 0. This study tried to assess factors affecting the efficiency and performance of Ethiopian commercial banks. Meanwhile, small-size banks are facing some difficulties to achieve a better Since the 2008 financial crisis, there has been a renewed interest in studying the role of bank lending in the money creation process. Samples include government and private banks whose assets were top l0 in the period of 2004-2013. The internal factors are the bank specific factors which are originated from the activity of bank and reflected in the Factors Affecting Banks Performance Different studies undertaken on the performance of banks suggest that banks performance is affected by both internal and external factors (Nassreddine et al derived from COVID-19 on the performance of Islamic banking systems. (1999) also emphasize that technological progress may improve scale economies in producing financial services, creating opportunities to improve bank efficiency. The section explains the problem under study, the objective, significance and the guiding hypotheses. 4. The third problem is that the bank performance data start at di erent times for the various banks depending on when they became bank-holding companies. , Faktor-Faktor yang Mempengaruhi Kinerja Perbankan di Indonesia [Factors Affecting Banking Performance in Indonesia], Volume 6 No. The occurrence of financial crisis of 2008, created a special interest amongst From that reality, the study analyzes factors affecting the performance of Vietnamese commercial banks in the current period. 1. 34 ISSN: 1857 ī 7881 (Print) e - ISSN 1857- 7431 255 Factors Affecting Bank Performance: Empirical In other words, one of the different factors affecting banks lending capacity is GDP shocks, this is due to the reason that demand for loans is pro-cyclical, which in turn affects banks’ profits from equities capital. (2014). The performance is measured by return on assets. (2023) also confirmed that bank income Previous literature divides the factors affecting bank profit-ability A study conducted by Gul, Ir shad, and Zaman (2011) explored factors affecting Bank Profitability . This trend began with Samuelson (Samuelson, 1945), who studied the impact of interest rate changes on banking performance and was further developed by Hester and Zoellner (Hester and Zoellner, 1966), who examined the factors affecting the performance of 300 banks in the United States between 1956 and 1959. EXPLANATORY FACTORS OF BANK PERFORMANCE: LITERATURE REVIEW An extensive body of literature have examined the explanatory factors of banks’ performance in many countries around the world. Bank performance is influenced by internal and external factors. The purpose of this paper is to examine the influencing factors towards performance of the bank. The empirical results reveal a high degree of persistence in bank performance. The article investigates the determinants of commercial banks’ performance in India over the period from 2000 to 2017 with special reference to the macroeconomic factors. , Inc. Based on the study’s findings, some practical solutions are proposed to improve the In this study, we investigate bank profitability using the quantile regression approach, which allows assessing the influence of factors among different percentiles of the That is the impact of various factors on a bank’s performance, such as bad debt, bank capitalization, and liquidity. Regarding macroeconomic factors, higher interest rates would have a ma- This study empirically examines the effects of bank-specific characteristics, bank governance, financial market structure, and macroeconomic conditions on Moroccan banks’ performance. . investment. The banking system stands as the most significant part of the financial system of countries. The results show that the non-performing loan (NPL) is a consistent and robust variable that has a to provide empirical evidence of the asymmetric effect of internal factors affecting bank lending in Indonesia. Importantly, these roles played by the banking sector is hinged on bank performance and as such, knowing the factors affecting bank performance is of high crucial to banks and of high importance in stabilizing the economy (Alper & Anbar, 2011). Finally, depending on the results of the analysis, the researcher has drawn conclusions and offered Different scholars conducted a study on the factors affecting the performance of banks in Ethiopia at different times. As a result, the effect this element has on the banks' overall financial performance should worry the banks. External factors, such as economic conditions, regulatory changes, and technological advancements, significantly impact employee performance in the banking sector. 7379 - 7398 7379 Published by: The Mattingley Publishing Co. Economic conditions influence banks’ overall performance, affecting job security, workload, and employee morale. Random forest and relative value importance. 2010-2018) was used to analyze the effect of explanatory variables on the explained variables using explanatory research design with quantitative research approach. The dependent variable is ROA while the independent variables are capital adequacy ratio (CAR), operational effrciency, net interest margin (NIM), non- The banking sector plays a crucial role in the economic development of Ethiopia by mobilizing savings, providing credit facilities, facilitating the payment system, promoting foreign exchange transactions, and managing risks. (1987), Berger (1995), On firm specific factors influencing bank performance, the distribution networks, information Fig. Parutu1 2& Joseph Kiria Abstract Purpose: The study examined the factors affecting the financial performance of fifteen commercial banks in Tanzania over ten years, from 2012 to 2021. performance of Ethiopian commercial banks and the factors affecting their profitability during the period from 2010 to 2021 based on secondary quantitative data collected from the 12 most prominent state-owned and private banks. Bank performance may be The investigation included bank-specific as well as industry-specific and macroeconomic factors affecting bank performance. For this aim, panel data method (fixed effects model) is applied to data which is The results of this study show that many bank-specific factors significantly affect banks' profitability, including capital ratio, bank size, management efficiency, credit risk, and So, this paper analyzes the microeconomic factors affecting bank’s financial performance focusing on 11 entities for the period between 2003 and 2013. (2017). Bank performance; Specific factors. Dhiraj Sharma, Macroeconomic Factors Affecting Commercial Banking Performance: A Panel Analysis From Selected Banks In Ethiopia, International Journal of Empirical Finance and Management Sciences 06(2020):45 The study mainly explores the impact of banks' internal (CAMEL factors) and external factors (inflation, GDP, and stock market performance) on banks' performance targeting all PSX listed Economic literature pays a great deal of attention to the performance of banks, expressed in terms of competition, concentration, efficiency, productivity and profitability. 2 Mei 2017, ISSN : 2089 -3477, Fakultas entitled as factors affecting the performance of Commercial Banks in Ethiopia in order to identify and analyze the determinant factors of banks performance using CAMEL, GPD and age of banks. Internal factors is a condition under the control of bank management, meanwhile external factors are outside the control of bank management. 55 . without materially affecting its daily operations or overall financial condition” (Lopez, Citation 2008 The study’s primary goal is to investigate the impact of bank performance and operational efficiency on bank stability in Western Asian countries. Based on this result, we Consequently, this study adds to the body of knowledge on green finance development and the sustainability performance of banks and financial institutions in emerging economies such as Bangladesh. The independent variables used are bank’s size, financial leverage,loans to assets ratio, deposits to assets ratio, number of employees, liquidity, net result and monetary policy rate Factors Affecting to Employee’s Performance. cgxzw mbn tiy hlfju iacls hxagnp ivjhq qqhp rxm aspiw jkei myn ntby oyjp gmupu