An Empirical Analysis of the Impact of Agricultural Banking Industry profitability in Bangladesh: An Evaluation of Internal Indicators of RAKUB

The study is on diagnostic and exploratory in nature and it depends on secondary data. The finding shows a steady growth in terms of branches, manpower, deposits, loan& advances, investments, total income, total expenditure, deposit interest rate, loan interest rate and net profit of RAKUB (Rajshahi Krishi Unnayan Bank) during the period 2004-2011. Using simple regression analysis, was used to test the trend of indicators were significantly positive tendency with the change of the above period. Correlation matrix was use to find the inter relationship among the indicators, total net profit have strongly related with manpower, total deposit, total loan and advance, loan recovery, total income and total expenditure. Using multiple regression analysis, a variance inflation factor (VIF) demonstrated that there was no evidence of a multicollinearity problem among the indicators when total net profit was considered as a dependent indicator. The coefficients of the regression line demonstrated that there was a significant positive relationship between the total net profit and number of branch, manpower, total deposit, total loan and advance, loan disbursement, loan recovery, total invest, deposit interest rate with (P less than 0.05), while the total expenditure was a negatively association with total net profit. Stepwise regression analysis showed that with respect to total net profit, the best indicators were loan recovery, number of branch, manpower and total loan& advance. These results suggest that most of the profitable appear to influence for improving the rural economic future performance of Bangladesh by Rajshahi Krishi Unnayan Bank (RAKUB) to develop the loan recovery, number of branch, manpower, total loan& advance.