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The study examines the bank-specific and macroeconomic determinants of banks profitability in Nigeria analyzing audited financial reports of selected sixteen (16) commercial banks over the period of 2010 to 2015 making up to 96 observations. The study identified that existing studies are sketchy in developing economies even though many studies have emerge in developed economies. The bank profitability is measured by return on assets and return on equity as function of bank-specific and macroeconomic determinants. Using the balanced panel data set, the empirical results of the study shows that capital adequacy and liquidity have a positive and significant effect on bank profitability. However, efficiency ratio have a negative and significant effect on bank profitability. With regards to macroeconomic variable, GDP growth also have a positive and significant impact on banks profitability. The empirical results of the study suggested that banks can improve their profitability through increasing capital and liquidity, decreasing operating cost with conscious effort to maintain transparency in their operations. In addition, a good economic environment for financial institutions foster increase in bank profitability. Hence, the study recommends that further studies can expand the scope while extending to other industries as well.

The main purpose of this study is to measure up to what extent the independent factors defined by capital adequacy ratio, non-performing loans ratio, cost-income ratio, liquidity ratio, and loans-to-deposits ratio impact the financial performance of sixteen commercial banks operating in the United Arab Emirates using panel data for the period of 2013-2019. The secondary data was collected from banks and examined by applying standard descriptive statistics and the random effect model for hypothesis testing. It is concluded from the regression outcomes that non-performing loans ratio and cost-income ratio have a significant negative impact on commercial banks profitability in the United Arab Emirates, while capital adequacy ratio, liquidity ratio, and loans -to-deposits ratio all have a very weak positive relationship on the return on assets but they are not determinants of bank’s profitability due to the insignificant statistical impact on it. It is therefore suggested that to enhance financial performance and minimize the risk of non-performing loans in the future, banks must watch very carefully the loans’ performance and analyze thoroughly the clients’ credit history and ability to pay back their debts prior to any approval of loan applications. Furthermore, banks should continuously improve their assets utilization, liquidity, and techniques of managing operating costs, improve the impact of capital adequacy, and the use of deposits for lending activities from a weak positive impact to a significant positive impact on their profitability. The researchers recommend that future studies on credit risk management influence on banks’ financial performance should consider more independent variables and longer periods of study such as twenty or thirty years to have more accuracy and generalized results.  

The aim of the empirical study is to investigate credit risk determinants in banking sectors across three kinds of South Asian economies. An accumulated sample of 105 unbalanced panel data of financial firms over the period of 2000-2015, by applying General Method of Moment (GMM) estimation techniques one-step at the difference in order to identify factors influencing credit risk. This study is inspired by two broad categories of explanatory variables which are bank-specific and macroeconomic. Bank-specific factors influencing unsystematic risk, while macroeconomic factors promoting systematic risk. The study uses a proxy of non-performing loans for credit risk in banking sectors of Pakistan, India, and Bangladesh. The empirical results have been found aligned with theoretical arguments and literature as expected. In comparison, NPLs in Pakistan is greater than India and Bangladesh, while India has the lowest ratio of non-performing loans. The study documents that bank-specific factors (inefficiency, profitability, capital ratio and leverage) have a significant contribution towards credit risk. Further, the study also finds a significant impact of macroeconomic variables on non-performing loans. While, the result in the case of Bangladesh predicts contradictions that have no significant effect on non-performing loans at various levels. The overall results indicate that credit risk is not influenced by only external factors but also affect by internal factors like bad management and skimping etc.

The purpose of this article is to examine the impact of selected internal and external factors on a bank’s profitability. The research investigates the impact of operational size, liquidity, risk appetite, management efficiency, product diversification, concentration, GDP growth and inflation change on the profitability of sample of 4179 European commercial banks for the period between 2011 and 2015. The input data were obtained from the Orbis Focus and the World Bank databases. The determinants were used to construct two models with ROAA and ROAE as a proxies and regression analysis using between groups panel approach was conducted. It has been found that growing economy impacts banks’ profitability positively. It has been robustly confirmed that management efficiency, product diversification, market concentration and inflation result in decreased profitability. The operational size has been found to be negatively linked to changes in net results but was confirmed only with ROAA model. Similarly, statistically significant results with regard to liquidity were found only for ROAA model and the correlation was positive. The strong negative impact of market concentration on profitability is an interesting finding allowing for further exploration of reasons for this unexpected vector of correlation.

This study examines the influence of liquidity on the profitability of Iraqi commercial banks. Five banks based in Iraq namely: North bank, Iraqi Islamic bank, Sumer bank, Dar Es-Salam bank and Babylon bank randomly selected and analyzed for the current study over the period 2005 to 2013. Moreover,  annual reports of these banks have studied and the main ratios of profitability and liquidity were calculated. These reports are available at Iraqi Stock Exchange site. The variables that were identified as independent for liquidity were, loan deposit ratio, deposit asset ratio and cash deposit ratio, while return on assets as dependent variable for profitability. The Ordinary Least Square (OLS) model used to examine the impact of liquidity on profitability. The study observes that any increase in liquidity ratios as above mentioned will lead return on asset to increase as well. Depending on this study it could be better for Iraqi banks to keep a balance between liquidity and profitability.

This study examines whether risk asset exposure affects the financial performance of commercial banks in Cameroon, a bank-dominated economy of the Central African Economic and Monetary Community (CEMAC). Risk asset exposure is measured by lending intensity (the loan-to-deposit ratio) and credit expansion (annual loan growth), and performance by return on assets (ROA). The data form a balanced panel of ten commercial banks over 2014–2024, compiled from the prudential reporting system of the Central African Banking Commission (COBAC) as published by Cameroon's National Economic and Financial Committee. Bank fixed-effects regressions with bank-clustered standard errors are complemented by a wild-cluster bootstrap suited to few clusters, Driscoll–Kraay standard errors, lagged regressors, panel Granger non-causality tests and a within–between (Mundlak) decomposition that separates changes in a bank's own exposure from persistent differences between banks. The main findings are that (i) neither lending intensity nor credit expansion is significantly associated with profitability in any specification (bootstrap p = 0.81 and 0.30), and the confidence intervals exclude effects larger than about one percentage point of ROA; (ii) lending intensity is unrelated to profitability both within banks over time and between banks (between-effect bootstrap p = 0.88); and (iii) the COVID-19 years of 2020–2021 were associated with ROA about 0.70 percentage points lower (bootstrap p = 0.009). The results indicate a limited role for lending exposure, while significant bank fixed effects and the COVID-19 coefficient point to persistent bank heterogeneity and common systemic shocks. Because the sample comprises ten banks under a single regulator, the findings should be interpreted with caution.

This study examined the effect of deposit diversification on the financial performance of Deposit-Taking Savings and Credit Cooperative Societies (DT-SACCOs) in Kenya and evaluated the moderating effect of corporate governance on this relationship.  The study adopted a positivist research philosophy and a causal research design. The target population comprised 176 SASRA-licensed DT-SACCOs in Kenya, from which 122 SACCOs with complete financial records for the period 2015–2024 were selected using simple random sampling. Panel data techniques, including fixed-effects and random-effects regression models, were employed to estimate the direct and moderating effects, while hierarchical regression was used to test the moderation hypothesis. The findings revealed that non-withdrawable deposits significantly and positively influenced both surplus and dividend payout after introducing lags, whereas withdrawable deposits had no significant effect on financial performance. The results further established that corporate governance had a positive and significant direct effect on financial performance and significantly strengthened the relationship between deposit diversification and financial performance. The findings provide practical guidance for DT-SACCO managers and policymakers to strengthen stable deposit mobilization and corporate governance as mechanisms for enhancing financial sustainability and institutional performance.

This paper examines how uninsured deposits influence credit union funding and whether private excess deposit insurance alters the stability, pricing, and lending capacity of uninsured deposits — deposits that exceed the federal deposit insurance limit. Using U.S. credit union Call Report data from 1995–2022, we exploit variation across institution size, insurance regime, and participation in optional private excess deposit insurance.  We distinguish between pre-crisis (1995–2007) and post-crisis (2009–2022) periods surrounding the 2008 expansion of federal insurance limits.  We document pronounced heterogeneity across the size distribution.  For small credit unions, uninsured deposits are limited in scale and are associated with lower loan intensity.  In contrast, uninsured deposits play a central funding role for large credit unions, which account for 94% of industry assets and 97% of uninsured deposits. For these institutions, uninsured deposits support lending and command higher funding costs — effects that are significantly moderated by excess deposit insurance, reducing funding costs by approximately 27 basis points during the pre-crisis period.  Following 2008, excess insurance participation declines among large institutions but increases modestly among small firms.  Overall, excess deposit insurance functions as a partial substitute for federal coverage, stabilizing uninsured funding without increasing delinquency rates — evidence against moral hazard.

This study explored the bank-specific and macroeconomic factors influencing capital adequacy in South African commercial banks. In this research, a balanced panel data set comprising 11 recapitalized banks was employed, spanning the period from 2008 to 2019. Employing panel regression techniques including OLS, Fixed Effects, Random Effects, and the Generalized Method of Moments (GMM), the analysis examines the influence of profitability (ROA), bank size, leverage, broad money supply, and the central bank’s monetary policy rate on the Capital Adequacy Ratio (CAR). The results indicate that profitability, bank size, leverage, and the broad money supply are critical determinants of capital sufficiency. Banks with increased profitability and increased exposure to the money supply typically demonstrate more robust capital positions. Larger bank size and increased leverage levels negatively affect capital adequacy ratios. The little impact of the delayed CAR signifies minimal persistence in capital buffer methods over time, implying that banks may not significantly depend on prior year capital conditions in their current capital planning. The study highlights the complex nature of capital sufficiency, influenced by microeconomic factors such as size and leverage, as well as macroeconomic indices like the money supply. The findings substantiate the Capital Buffer Theory and furnish critical insights for regulators, bank executives, and policymakers seeking to bolster the resilience of the banking industry in South Africa.

The COVID-19 pandemic triggered a global economic crisis that significantly impacted the South African banking sector, already weakened by a pre-existing recession. While bank profitability and credit quality declined, stock market reactions appeared less severe, indicating a potential disconnect between fundamentals and investor behaviour. This study explores the influence of investor sentiment on credit risk, lending, and performance (ROA) of selected JSE-listed banks during the pandemic, incorporating behavioural finance perspectives. Panel regression analysis reveals that COVID-19 had a significant negative effect on stock, ROA and ROE, driven by heightened uncertainty and rising non-performing loans. Liquidity and capital positively influenced returns and ROE, reflecting investor confidence in resilient banks. Investor sentiment had a weakly positive impact on returns, but a significant negative effect on both ROA and ROE, suggesting that excessive optimism may have led to riskier lending practices and reduced profitability. Larger banks underperformed in terms of returns, likely due to operational complexity during the crisis. These findings highlight the critical role of behavioural factors in shaping financial outcomes during systemic shocks and provide new insights into emerging market banking dynamics under crisis conditions.