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VOL. 7, ISSUE 3 (2025)
Bank specific and macroeconomics determinants of profitability of Commercials Banks in Nepal
Authors
Asmita Nepali Darji
Abstract
This study aims to examines the factors
influencing the profitability of commercial banks in Nepal, focusing on both
specific bank specific and macroeconomics determinants over the time period
from 2013/14 to 2022/23. Return on assets and return on equity are taken as
dependent variables. similarly, Bank size, Capital Adequacy Ratio,operational
efficiency ratio,deposit asset ratio,non performing loan ratio , Gross domestic
product and consumer price index are taken as independent variables.A random
sampling technique are used to select a sample of six banks which are listed on
NEPSE.Data were collected from audited annual reports of sampled banks and
Nepal's economic survey report.Quantitative analysis has been conducted using
statistical tools such as pearson's correlation and multivariate regression
models to test the significance and importance of bank specific and
macroeconomics determinants on profitability of commercials banks in Nepal.The
finding reveal that Bank size has positive relationship with profitability
indicators, while non performing loan and operational efficiency influence both
ROA and ROE, Macroeconomics factors like GDP have a positive impact on ROA, CPI
Exhibit negative relationship. It can be concluded that efficient management of
non-performing loan, operational effeciency and adaptation of macroeconomic
condition improve profitability of banks.
Pages:31-38
How to cite this article:
Asmita Nepali Darji "Bank specific and macroeconomics determinants of profitability of Commercials Banks in Nepal". International Journal of Finance and Commerce, Vol 7, Issue 3, 2025, Pages 31-38
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