The Determinants of Commercial Bank Profitability in Indonesia

2014 ◽  
Author(s):  
Arief Putranto ◽  
Aldrin Herwany ◽  
Erman Sumirat
Keyword(s):  
Commercial Bank ◽  
Bank Profitability

scholarly journals Internal Determinants of Commercial Bank Profitability In Indonesia

2017 ◽  
Vol 8 (3) ◽  
pp. 219-223 ◽  
Author(s):  
Umi Widyastuti ◽  
Purwana E.S. Dedi ◽  
Sri Zulaihati
Keyword(s):  
Credit Risk ◽  
Commercial Bank ◽  
Commercial Banks ◽  
Least Squares Method ◽  
Ordinary Least Squares ◽  
Capital Adequacy ◽  
Operating Efficiency ◽  
Bank Profitability ◽  
Operating Income ◽  
Net Interest Margin

Abstract Internal determinants of bank profitability can be defined as those factors that are influenced by the bank’s management decisions and policy objectives. This paper is aimed to examine the internal factors that impact on commercial banks profitability in Indonesia. The factors reviewed in the model namely capital adequacy, credit risk (non-performing loan), liquidity (loans to deposit ratio), net interest margin and operating efficiency (operating expenses to operating income ratio). Using purposive sampling method, the analysis used thirty three commercial banks, with 168 observations for the period 2010 to 2015. Based on the Chow-test, the common effect model was preferred. The model is estimated using Ordinary Least Squares method. The results revealed that two hypotheses were not be accepted. There are no significant effects of capital adequacy and credit risk on profitability, but the model explains that there are significant effects of all explanatory variables toward commercial bank profitability. However, other important internal determinants of bank profitability still have not included in the model of this paper.

scholarly journals CREDIT RISK AND COMMERCIAL BANK PROFITABILITY IN RWANDA.

2016 ◽  
Vol 4 (9) ◽  
pp. 294-325
Author(s):  
JohnBosco Rwayitare ◽  
◽  
DrJaya Shukla ◽  
DrCharles Ruhara. ◽  
◽  
...  
Keyword(s):  
Credit Risk ◽  
Commercial Bank ◽  
Bank Profitability

scholarly journals PROFITABILITY OF COMMERCIAL BANKS OF RUSSIA: MODERN STATE AND DEVELOPMENT TRENDS

2018 ◽  
pp. 139-148 ◽  
Author(s):  
Elena Borisovna Starodubtseva ◽  
Olga Mikhailovna Markova
Keyword(s):  
Commercial Bank ◽  
Commercial Banks ◽  
Raw Materials ◽  
Performance Criteria ◽  
Financial Indicators ◽  
Bank Profitability ◽  
International Capital Markets ◽  
Financial Condition ◽  
Growth Increase ◽  
Internal And External Factors

Profitability indicators are included in the group of key financial indicators of a modern commercial bank, in particular, they act as one of the key performance criteria for a commercial bank, the use of assets and liabilities. The growth of profitability of a commercial bank contributes to the improvement of its financial condition; profitability is one of the components of the competitiveness of a commercial bank; profitability is important for business owners and investors. Improving profitability is a tool to increase the investment attractiveness of the bank, contributes to the growth of the market value of the shares. Increasing profitability is one of the main tasks of a modern commercial bank. There has been carried out the comparative analysis of profitability criteria of the largest commercial Russian banks: PJSC Sberbank, PJSC VTB, PJSC Gasprombank, JSC “Rosselkhozbank”, JSC “Alfa-bank”, etc. It has been stated that in recent years the profitability of commercial banks in Russia was rather unstable, but the most banks are profitable both in capital and in assets. Banks with state share 16.1% have the lead in capital profitability. The analysis of the two major indicators of profitability (assets and capital) showed their vulnerability to a range of internal and external factors. There have been determined the reasons of decreasing assets profitability of the commercial banks: problems of external funding; access to international capital markets in terms of sanctions against Russian banks; decrease of prices on oil and other raw materials. All this results in a slowdown of the state economics, inflation growth, increase of the proportion of non-performing loans and additional expenses on levies, etc. Proposals to improve profitability have been made.

scholarly journals The Determinants of Commercial Bank Profitability in Sub-Saharan Africa

2009 ◽  
Vol 09 (15) ◽  
pp. 1 ◽  
Author(s):  
Valentina Flamini ◽  
Liliana Schumacher ◽  
Calvin A. McDonald ◽  
◽  
◽  
...  
Keyword(s):  
Commercial Bank ◽  
Sub Saharan Africa ◽  
Bank Profitability ◽  
Sub Saharan

scholarly journals Measuring Commercial Bank Profitability: Proceed with Caution

2007 ◽  
Vol 89 (6) ◽  
Author(s):  
R. Alton Gilbert ◽  
David C. Wheelock
Keyword(s):  
Commercial Bank ◽  
Bank Profitability

scholarly journals Financial Information Influencing Commercial Banks Profitability

2016 ◽  
Vol 8 (6) ◽  
pp. 166 ◽  
Author(s):  
Dhiaa Shamki ◽  
Ibrahim Khalaf Alulis ◽  
Karima Sayari
Keyword(s):  
Commercial Bank ◽  
Commercial Banks ◽  
Regression Models ◽  
Positive Influence ◽  
Bank Capital ◽  
Bank Profitability ◽  
Bank Management ◽  
Ratio Size ◽  
Multiple Regression Models ◽  
Capital Ratios

<p>The paper investigates the influence of bank capital ratio, size and loans on the profitability of a commercial bank in Jordan. It also evaluates whether returns on Assets (ROA) or returns on equity (ROE) is the better indicator that reflects bank profitability. Two Multiple regression models are used to test the influence of capital ratio, size and loans of a commercial bank on its profitability indicators measured by ROA and ROE and to detect the superiority between the two indicators for 13 Jordanian commercial banks for the period 2005-2013. The results of the study showed that capital ratio, size and loans have insignificant influence on ROA, but not on ROE except bank size. Regarding ROE, significant negative and positive influence for capital ratio and loans respectively are concluded. Although the small number of commercial banks in Jordan and some variables have not been well researched in literature, the paper presents a sight to associate bank performance/profitability proxied by ROA and ROE with its capital ratios, size and loans. Our results might assist bank management to capitalize the factors that could improve banks performance and hedge against the adverse factors.</p>

Commercial Bank Profitability by Function

1973 ◽  
Vol 2 (1) ◽  
pp. 64 ◽  
Author(s):  
Thomas Joseph Coyne
Keyword(s):  
Commercial Bank ◽  
Bank Profitability

scholarly journals Determinants of Commercial Bank Profitability: South Asian Evidence

2013 ◽  
Vol 5 (1) ◽  
Author(s):  
Shrimal Perera ◽  
Michael Skully ◽  
Zahida Chaudrey
Keyword(s):  
Commercial Bank ◽  
South Asian ◽  
Bank Profitability
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