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Profitability drivers for Indian banks: a dynamic panel data analysis

Profitability drivers for Indian banks: a dynamic panel data analysis The study aims to find the factors such as bank specific factors, banking industry factors and macroeconomic factors that affect bank profitability in India. The paper employs the data from Indian Public sector and Indian private sector banks for the period from 2006–2007 to 2012–2013. Both these banks contribute to more than 90% of total business of scheduled commercial banks in India. The study applies the dynamic panel data analysis. The dependent variables include return on average assets and return on equity, and independent variables include bank specific factors, banking industry factors, and economic factors. Among the bank specific factors, non performing loans and cost to income ratio negatively affects the bank profitability, and diversification measures do not affect the bank profitability. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Eurasian Business Review Springer Journals

Profitability drivers for Indian banks: a dynamic panel data analysis

Eurasian Business Review , Volume 8 (4) – Dec 15, 2017

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Publisher
Springer Journals
Copyright
Copyright © 2017 by Eurasia Business and Economics Society
Subject
Business and Management; Business and Management, general; Innovation/Technology Management; Entrepreneurship; Emerging Markets/Globalization
ISSN
1309-4297
eISSN
2147-4281
DOI
10.1007/s40821-017-0096-2
Publisher site
See Article on Publisher Site

Abstract

The study aims to find the factors such as bank specific factors, banking industry factors and macroeconomic factors that affect bank profitability in India. The paper employs the data from Indian Public sector and Indian private sector banks for the period from 2006–2007 to 2012–2013. Both these banks contribute to more than 90% of total business of scheduled commercial banks in India. The study applies the dynamic panel data analysis. The dependent variables include return on average assets and return on equity, and independent variables include bank specific factors, banking industry factors, and economic factors. Among the bank specific factors, non performing loans and cost to income ratio negatively affects the bank profitability, and diversification measures do not affect the bank profitability.

Journal

Eurasian Business ReviewSpringer Journals

Published: Dec 15, 2017

References