Evaluation of Internal Factors Indicating Bank Profitability in Commercial Banks BangladeshJournal: International Journal of Science and Research (IJSR) (Vol.10, No. 8)
Publication Date: 2021-08-05
Authors : Rashedul Azim; Saifun Nahar;
Page : 443-450
Keywords : Commercial Banks; Profitability; Internal factors; and Panel Data;
Purpose of the study: Commercial bank plays a key role in the development and financial stability of the country. Therefore, this research has been carried out to analyze the possible effect of different relevant internal factors determinants on commercial banks profitability in Bangladesh. Methodology: We consider the statistical tools SPSS 25 version through descriptive statistics and a panel regression model is built on balanced panel data using 16 commercial banks listed by DSE and CSE over the sample period of 2016 - 2020. The authors performed an analysis of the bank profitability model was tested empirically. Findings: The results that were obtained from the profitability model indicated there is a significant positive correlation between ROA of commercial banks with TEA, TLD, TCA, TIA, OETA, and CIR while negative correlation BS showed the statistically insignificant impact on profitability. Regression findings from the model reveal that TEA and TLD and profitability have statistically significant while TCA, TIA, OETA, CIR, and BS had an insignificant impact. However, it is recommended that empirical studies should be undertaken in the same field to find out what more internal factors could affect the profitability of banks. Practical implications: Overall, the authors' findings bring some new but useful views to the banking literature. Some recommendations may be functional for the sustainable performance of banks. Originality/value: Because of study results, the authors provide interesting insights into the practices and characteristics of banks in banks in Bangladesh listed by DSE and CSE. The study also highlights significant bank internal factors to improve the selected commercial banks in Bangladesh.
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