International Journal of Economics and Financial Issues, Nov 10, 2023
This paper aims at investigating the relationship between profitability and liquidity of the Stat... more This paper aims at investigating the relationship between profitability and liquidity of the State-Owned Commercial Banks of Bangladesh. An important motive of this study is to provide valuable insights into how liquidity influences profitability. There are various research papers on liquidity exposure and the profitability relationship of banks in Bangladesh. But those researches are separately conducted for conventional or Islamic banks or there is a comparative analysis of both banks. But there is little research on the state-owned banking industry. During the Pandemic the banking industry of Bangladesh was affected severely in respect of liquidity risk and it also affected its profitability. There is no recent paper focused on this study. So, this study will try to identify the significant factors that affect the liquidity of a bank and its profitability. In this regard, 10 years' data from Annual Report of the State-Owned Commercial Banks and macroeconomic data from Bangladesh Bank website and several journals have been collected from 2012 to 2021. This study primarily aims at exploring the liquidity-profitability relationship using econometric model. Loan to Deposit ratio is used measuring liquidity of a bank. Other control variables Loan Loss Provision to Total Asset (LLPTA) for credit risk, Equity to Total Asset (EQTA) for capital efficiency, Operational expense to Total Asset (OPEXTA) for operational efficiency, Total Asset (TA) for Bank size, Non-performing Loan (NPL) for asset quality, Gross Domestic Product (GDP) for economy size, Inflation (INF) for consumer price index, Interest Rate (INT) for opportunity cost, and the Unemployment rate for measuring labor force. The major finding of this study show that there is a significant positive relationship between liquidity risk and profitability. Among bank-specific variables credit risk, capital efficiency, and bank size have a significant relationship with Profitability which also supports the theory. Macroeconomic variables like interest rate, inflation rate, and GDP have a significant relationship with profitability which also supports the theory. Here BDBL and BASIC should have maintained the liquidity standard mentioned by Bangladesh Bank and BIS to mitigate their liquidity crisis. This study also shows that there is no severe effect of the COVID pandemic on the State-Owned Commercial Banks of Bangladesh. The findings of this study will provide valuable insights for banks and regulators to make informed decisions regarding risk management, liquidity decision, capital allocation, and strategic planning.
International Journal of Energy Economics and Policy
This paper investigates the consequences of economic development, along with energy consumption, ... more This paper investigates the consequences of economic development, along with energy consumption, international trade, and population growth, on the CO2 emissions of Bangladesh as a participant in an emerging economy, covering periods from 1972 to 2021. The unit root properties of the variables have been tested using the Augmented Dickey-Fuller (ADF) approach to examine the presence of stationary of data series. To check for co-integration in the data series of variables included in the models, we used the ARDL (Autoregressive Distributive Lag) bounds testing approach. In addition, the VECM (Vector Error Correction Model) Granger Causality approach has been used to examine the casual relationship between the selected variables representing the proxy for determinants of CO2 emission in Bangladesh. Our investigation confirms the co-integration between the data series, followed by the significant impact of these variables on CO2 emissions of Bangladesh. More precisely, GDP being the pro...
International Journal of Economics and Financial Issues
This paper attempts to investigate the impact of bank-specific determinants on the stock price of... more This paper attempts to investigate the impact of bank-specific determinants on the stock price of Dhaka Stock Exchange (DSE) listed commercial banks in Bangladesh. Several bank-specific factors such as Book to Market Ratio, Return on Equity, Price/Earnings to Growth Ratio, Cash Flow per Share, Debt to Equity Ratio, Earnings per Share, Dividend per Share, Bank Size and Institutional Ownership Percentage have been analyzed for this study and tried to see the impact of each variable on the change in market price of share of 10 listed commercial banks spanning from 2011 to 2020. In empirical discussion four estimation models such as Fixed effects, Random effects, GLS, and Pooled OLS approach have been used to ensure the robustness of the models. To examine the validity of the models chosen for this study, the model specification test and many diagnostic checks were used, including the test of heteroskedasticity, the cross-sectional dependence test, the test of autocorrelation and the un...
International Journal of Economics, Finance and Management Sciences, 2017
This paper on the interest rate risk management of a bank will provide a detailed picture of risk... more This paper on the interest rate risk management of a bank will provide a detailed picture of risk management of bank because it is one of the concerned factors for every bank. This study will also indicate any shortfall of bank in terms of interest rate risk management and offer suitable recommendations. Interest rate risk is the exposure of a bank's financial condition to adverse movements in interest rates. Accepting this risk is a normal part of banking and can be an important source of profitability and shareholder value. However, excessive interest rate risk can pose a significant threat to a bank's earnings and capital base. Changes in interest rates affect a bank's earnings by changing its net interest income and the level of other interest sensitive income and operating expenses. Changes in interest rates also affect the underlying value of the bank's assets, liabilities, and off-balance-sheet (OBS) instruments because the present value of future cash flows (and in some cases, the cash flows themselves) change when interest rates change. Accordingly, an effective risk management process that maintains interest rate risk within prudent levels is essential to the safety and soundness of banks.
International Journal of Research In Business and Social Science, Jun 29, 2022
Investigating the dynamic impact of firm-specific and macroeconomic drivers on profitability of g... more Investigating the dynamic impact of firm-specific and macroeconomic drivers on profitability of general insurance companies in Bangladesh Raad Mozib Lalon (a)* Joy Das (b)
This investigation aims to reveal how the profitability of local private commercial banks in Bang... more This investigation aims to reveal how the profitability of local private commercial banks in Bangladesh is affected by their intellectual capital determinants. Secondary sources like annual reports of 10 private conventional commercial banks in Bangladesh were used to get data from 2008 to 2020. This paper uses econometric modeling techniques to examine the relationship between the profitability measures of NIM ratio, ROA, and ROE of the selected private commercial banks and a number of relevant components of intellectual capital of banks such as human capital efficiency, structural capital efficiency and Bank’s relative efficiency along with some bank-specific control variables including income diversification, bank size, bank age, insolvency risks, leverage ratio and market share.Dynamic panel data models were then built using one-step system GMMtechniques to account for endogeneity, unobserved heterogeneity, and profitability persistence of the data set across the chosen time period. This study hasfound that intellectual capital along with leverage ratio, revenue diversification, bank age, bankruptcy risks, and market share are statistically significant to demonstrate differences in NIM, ROA, and ROE measuring profitability of our sampled banks. The one-step system GMM approach has effectively adapted the dynamic effects of intellectual capital on bank profitability, taking into consideration all estimate conditions. A more accurate evaluation of intellectual capital’s effect on the banking industry’s profitability may be obtained in a future research encompassing all banks in Bangladesh.
This paper attempts to investigate the impact of bank-specific determinants on the stock price of... more This paper attempts to investigate the impact of bank-specific determinants on the stock price of Dhaka Stock Exchange (DSE) listed commercial banks in Bangladesh. Several bank-specific factors such as Book to Market Ratio, Return on Equity, Price/Earnings to Growth Ratio, Cash Flow per Share, Debt to Equity Ratio, Earnings per Share, Dividend per Share, Bank Size and Institutional Ownership Percentage have been analyzed for this study and tried to see the impact of each variable on the change in market price of share of 10 listed commercial banks spanning from 2011 to 2020. In empirical discussion four estimation models such as Fixed effects, Random effects, GLS, and Pooled OLS approach have been used to ensure the robustness of the models. To examine the validity of the models chosen for this study, the model specification test and many diagnostic checks were used, including the test of heteroskedasticity, the cross-sectional dependence test, the test of autocorrelation and the unit root test, etc. Our investiagtion reveals that only Bank Size and Book to Market Value explanatory variables are found significantly responsible for fluctuation in the change in share price of banks, contributing to the current literature by revealing the importance of bank-specific factors that include all metrics in their calculation. As a result, Bangladesh’s DSE-listed banks should take appropriate measures to boost their stock values, such as attempting to improve the ratio that has a positive impact on the share price while decreasing the ratio that has a negative impact.
International Journal of Economics and Financial Issues
This paper aims to assess the impact of Cottage, Micro, Small and Medium Enterprises (CMSMEs) fin... more This paper aims to assess the impact of Cottage, Micro, Small and Medium Enterprises (CMSMEs) financing on bank performance estimated with NIM (net interest margin) ratio followed by ROE (return on equity) and ROA (return on assets) ratio considering ten commercial banks (both private and state-owned bank) of Bangladesh being a participant of emerging economy covering from the year 2011 to the year 2020. Adopting Pooled OLS, Fixed Effect (FE), Random Effect (RE) and Generalized Least Square (GLS) technique enables the estimation of coefficients corresponding to the explanatory variables of the models constructed with bank specific as well as macroeconomic control variables along with the CMSME financing factors affecting banks’ profitability. We also use diagnostic tests like the test of heteroskedasticity, multicollinearity, omitted variable, and autocorrelation to ensure our models are accurate. From this paper it will be cleared that the growth of CMSME financing can lead to high...
International Journal of Economics, Finance and Management Sciences, 2015
This Paper is not only a way for getting acknowledged about the efficiency in managing credit ris... more This Paper is not only a way for getting acknowledged about the efficiency in managing credit risk of Bangladeshi Banks, but also a conclusive reference for studying how CRM practices helps to increase profitability and long term sustainability of commercial banks. Credit risk management encompasses identification, measurement, matching mitigations, monitoring and control of the credit risk exposures. For conducting this research, I have to collect secondary data relating to the financial status of Basic Bank Ltd.In my analysis I have divulged a comprehensive overview about CRM in different phase of my report. First, I have described about the CRM practice and performance of BBL. Then, I analyze the impact of CRM on financial performance of bank. I have used Ms Excel as well as SPSS software to compare relationship between CRM and banks profitability. After analysis and discussion I have identified some conclusive findings of my research paper.
International Journal of Economics and Financial Issues
This paper aims to assess the impact of Cottage, Micro, Small and Medium Enterprises (CMSMEs) fin... more This paper aims to assess the impact of Cottage, Micro, Small and Medium Enterprises (CMSMEs) financing on bank performance estimated with NIM (net interest margin) ratio followed by ROE (return on equity) and ROA (return on assets) ratio considering ten commercial banks (both private and state-owned bank) of Bangladesh being a participant of emerging economy covering from the year 2011 to the year 2020. Adopting Pooled OLS, Fixed Effect (FE), Random Effect (RE) and Generalized Least Square (GLS) technique enables the estimation of coefficients corresponding to the explanatory variables of the models constructed with bank specific as well as macroeconomic control variables along with the CMSME financing factors affecting banks’ profitability. We also use diagnostic tests like the test of heteroskedasticity, multicollinearity, omitted variable, and autocorrelation to ensure our models are accurate. From this paper it will be cleared that the growth of CMSME financing can lead to high...
International Journal of Economics and Financial Issues
This paper aims to find out the significant firm-specific and macroeconomic determinants of opera... more This paper aims to find out the significant firm-specific and macroeconomic determinants of operating efficiency through covering 360 observations having 30 commercial banks’ data from 2009 to 2020. Model specification test along with several diagnostic tests has been done and our investigation reveals that Net interest margin or net investment income ratio, loan loss provision to total loan, debt to total assets and total loan to earning assets are significantly related with operating efficiency ratio (OER) bringing the changes in operating efficiency. In the second model, return on equity, net interest margin or net investment income ratio, equity capital to total assets, loan loss provision to total loan, bank size, total loan to earning assets and total loan to total deposit significantly affect the operating efficiency of commercial banks being measured with cost efficiency ratio (CER). In the subsequent model, net interest margin or net investment income ratio, total loan to e...
International Journal of Economics, Finance and Management Sciences, 2017
This paper on the compliance status of Basel-II of a state owned bank will provide a detailed pic... more This paper on the compliance status of Basel-II of a state owned bank will provide a detailed picture of risk management of bank as well as a gross picture of Basel-II implementation status in Bangladesh. This study will also indicate any shortfall of bank in terms of Basel-II compliance and offer suitable recommendations.. In this Paper, I have divulged the calculation of eligible capital, total risk exposure, risk weighted assets and capital adequacy ratio for Agrani Bank Limited. Following the standardized approach to calculate risk weighted assets. I have also shown the impact of Basel II adoption and problems regarding its implementation in banking industry of Bangladesh.
This paper aims to reveal the relationship between the determinants of financial performance and ... more This paper aims to reveal the relationship between the determinants of financial performance and stock performance measured with reference to the Price-Earnings (P/E) ratio. It examines Panel Data of 10 years covering from 2010 to 2019 of seven Private Commercial Banks (PCBs) of Bangladesh enlisted in the Dhaka Stock Exchange (DSE). Several hypotheses and econometric models have been estimated with the Pooled Ordinary Least Squares (Pooled OLS), Generalized Least Squares (GLS), Fixed-effect, and Random-effect, followed by various diagnostic tests to examine the validity of the models selected for this study. Finally, the One-step Generalized Method of Moments (GMM) method has been adopted. The empirical investigation shows that among the entire set of the variables, only the Net Profit Margin (NPM) ratio has a significant impact on the P/E ratio under Random-effect, GLS, and Pooled OLS. Finally, the model developed for the One-step GMM method has revealed that the inclusion of the L...
Recirculating aquaculture system (RAS) is a unique approach that offers total control to culture ... more Recirculating aquaculture system (RAS) is a unique approach that offers total control to culture a wide variety of aquatic species. As capital investment is higher for setting up RAS, it is necessary to conduct an economic feasibility analysis based on real data. A structured questionnaire was used to collect all economic and technical data on two catfish species, viz., Pabda ( Ompok pabda ) and Shing ( Heteropneustes fossilis ), cultured in an RAS farm. The ultimate objective was to estimate net cash flow, net present value (NPV), profitability index (PI), payback period, discounted payback period, internal rate of return (IRR), and sensitivity analysis to find out the best profitability indicators. The analysis revealed that the IRR were 4% and 16% for Pabda and Shing production, respectively. However, for Pabda and Shing productions, the payback periods were 15 years and 4 months and 6 years and 2 months, respectively. The NPV value was positive for Shing production and negative ...
The Journal of Economics and Business is an Open Access publication. It may be read, copied, and ... more The Journal of Economics and Business is an Open Access publication. It may be read, copied, and distributed free of charge according to the conditions of the Creative Commons Attribution 4.0 International license.
This paper attempts to reveal how profitability of non-life insurance companies operating in Bang... more This paper attempts to reveal how profitability of non-life insurance companies operating in Bangladesh are significantly affected by several insurance firm-specific factors such as profit or loss transferred from revenue account to total asset ratio, premium to total asset ratio, operating income to total asset ratio, operating cost to total asset ratio, debt to equity ratio, size of the firm and debt to total asset ratio using econometric modelling showing the causation between ROE (return on equity) being dependent variable measuring profitability and insurance industry specific factors being explanatory variables. Adopting random effect and well as fixed effect method followed by pooled OLS (ordinary least square) and cross-sectional GLS (generalized least square) approach enables us to estimate the coefficients of the models. Under fixed effect method, all the firm specific factors except operating income to total asset ratio are found statistically significant in explaining the variation of ROE followed by Random effect, pooled OLS, and Cross-sectional time series FGLS method showing the statistical significance of all other explanatory variables included in the models except operating cost to total asset ratio. After comparing the outcomes estimated by several models using model specification tests, Pooled OLS and FGLS have revealed the best estimations as per the ramifications of diagnostic checks such as test of heteroskedasticity, muticollinearity, autocorrelation and cross-sectional dependence to check the validity of the models. Keywords: Profitability; ROE; Firm Specific Determinants; Non-life Insurance; Operating Cost
International Journal of Economics, Finance and Management Sciences, 2017
This paper is designed to divulge the financial performance of a selective non-bank financial ins... more This paper is designed to divulge the financial performance of a selective non-bank financial institutions operating in Bangladesh using the ratio analysis of Lanka Bangla Finance Limited. Lanka Bangla Finance Limited is one of the best non-banking financial institutions in Bangladesh. It has become possible due to its proper usage of its resources. In this paper we will be able to find out how they have managed their assets to cover their liabilities. This report will also show why the ratio analysis is so important of a company. To conduct the study, we have collected secondary data from LBFL. This paper is solely based on the ratio analysis segmented in following four broad categories such as Liquidity Ratio, Solvency Ratio, Profitability Ratio and Market Prospect Ratio. We have accumulated in total of 17 ratios included in these four broad categories.
This paper attempts to forecast the economic performance of Bangladesh measured with annual GDP d... more This paper attempts to forecast the economic performance of Bangladesh measured with annual GDP data using an Autoregressive Integrated Moving Average (ARIMA) Model followed by test of goodness of fit using AIC (Akaike Information Criterion) and BIC (Bayesian Information Criterion) index value among six ARIMA models along with several diagnostic tests such as plotting ACF (Autocorrelation Function), PACF (Partial Autocorrelation Function) and performing Unit Root Test of the Residuals estimated by the selected forecasting ARIMA model. We have found the appropriate ARIMA (1,0,1) model useful in predicting the GDP growth of Bangladesh for next couple of years adopting Box-Jenkins approach to construct the ARIMA (p,r,q) model using the GDP data of Bangladesh provided in the World Bank Data stream from 1961 to 2019. JEL classification numbers: B22, B23, C53. Keywords: GDP growth, ACF, PACF, Stationary, ARIMA (p,r,q) model, Forecasting.
International Journal of Economics and Financial Issues, Nov 10, 2023
This paper aims at investigating the relationship between profitability and liquidity of the Stat... more This paper aims at investigating the relationship between profitability and liquidity of the State-Owned Commercial Banks of Bangladesh. An important motive of this study is to provide valuable insights into how liquidity influences profitability. There are various research papers on liquidity exposure and the profitability relationship of banks in Bangladesh. But those researches are separately conducted for conventional or Islamic banks or there is a comparative analysis of both banks. But there is little research on the state-owned banking industry. During the Pandemic the banking industry of Bangladesh was affected severely in respect of liquidity risk and it also affected its profitability. There is no recent paper focused on this study. So, this study will try to identify the significant factors that affect the liquidity of a bank and its profitability. In this regard, 10 years' data from Annual Report of the State-Owned Commercial Banks and macroeconomic data from Bangladesh Bank website and several journals have been collected from 2012 to 2021. This study primarily aims at exploring the liquidity-profitability relationship using econometric model. Loan to Deposit ratio is used measuring liquidity of a bank. Other control variables Loan Loss Provision to Total Asset (LLPTA) for credit risk, Equity to Total Asset (EQTA) for capital efficiency, Operational expense to Total Asset (OPEXTA) for operational efficiency, Total Asset (TA) for Bank size, Non-performing Loan (NPL) for asset quality, Gross Domestic Product (GDP) for economy size, Inflation (INF) for consumer price index, Interest Rate (INT) for opportunity cost, and the Unemployment rate for measuring labor force. The major finding of this study show that there is a significant positive relationship between liquidity risk and profitability. Among bank-specific variables credit risk, capital efficiency, and bank size have a significant relationship with Profitability which also supports the theory. Macroeconomic variables like interest rate, inflation rate, and GDP have a significant relationship with profitability which also supports the theory. Here BDBL and BASIC should have maintained the liquidity standard mentioned by Bangladesh Bank and BIS to mitigate their liquidity crisis. This study also shows that there is no severe effect of the COVID pandemic on the State-Owned Commercial Banks of Bangladesh. The findings of this study will provide valuable insights for banks and regulators to make informed decisions regarding risk management, liquidity decision, capital allocation, and strategic planning.
International Journal of Energy Economics and Policy
This paper investigates the consequences of economic development, along with energy consumption, ... more This paper investigates the consequences of economic development, along with energy consumption, international trade, and population growth, on the CO2 emissions of Bangladesh as a participant in an emerging economy, covering periods from 1972 to 2021. The unit root properties of the variables have been tested using the Augmented Dickey-Fuller (ADF) approach to examine the presence of stationary of data series. To check for co-integration in the data series of variables included in the models, we used the ARDL (Autoregressive Distributive Lag) bounds testing approach. In addition, the VECM (Vector Error Correction Model) Granger Causality approach has been used to examine the casual relationship between the selected variables representing the proxy for determinants of CO2 emission in Bangladesh. Our investigation confirms the co-integration between the data series, followed by the significant impact of these variables on CO2 emissions of Bangladesh. More precisely, GDP being the pro...
International Journal of Economics and Financial Issues
This paper attempts to investigate the impact of bank-specific determinants on the stock price of... more This paper attempts to investigate the impact of bank-specific determinants on the stock price of Dhaka Stock Exchange (DSE) listed commercial banks in Bangladesh. Several bank-specific factors such as Book to Market Ratio, Return on Equity, Price/Earnings to Growth Ratio, Cash Flow per Share, Debt to Equity Ratio, Earnings per Share, Dividend per Share, Bank Size and Institutional Ownership Percentage have been analyzed for this study and tried to see the impact of each variable on the change in market price of share of 10 listed commercial banks spanning from 2011 to 2020. In empirical discussion four estimation models such as Fixed effects, Random effects, GLS, and Pooled OLS approach have been used to ensure the robustness of the models. To examine the validity of the models chosen for this study, the model specification test and many diagnostic checks were used, including the test of heteroskedasticity, the cross-sectional dependence test, the test of autocorrelation and the un...
International Journal of Economics, Finance and Management Sciences, 2017
This paper on the interest rate risk management of a bank will provide a detailed picture of risk... more This paper on the interest rate risk management of a bank will provide a detailed picture of risk management of bank because it is one of the concerned factors for every bank. This study will also indicate any shortfall of bank in terms of interest rate risk management and offer suitable recommendations. Interest rate risk is the exposure of a bank's financial condition to adverse movements in interest rates. Accepting this risk is a normal part of banking and can be an important source of profitability and shareholder value. However, excessive interest rate risk can pose a significant threat to a bank's earnings and capital base. Changes in interest rates affect a bank's earnings by changing its net interest income and the level of other interest sensitive income and operating expenses. Changes in interest rates also affect the underlying value of the bank's assets, liabilities, and off-balance-sheet (OBS) instruments because the present value of future cash flows (and in some cases, the cash flows themselves) change when interest rates change. Accordingly, an effective risk management process that maintains interest rate risk within prudent levels is essential to the safety and soundness of banks.
International Journal of Research In Business and Social Science, Jun 29, 2022
Investigating the dynamic impact of firm-specific and macroeconomic drivers on profitability of g... more Investigating the dynamic impact of firm-specific and macroeconomic drivers on profitability of general insurance companies in Bangladesh Raad Mozib Lalon (a)* Joy Das (b)
This investigation aims to reveal how the profitability of local private commercial banks in Bang... more This investigation aims to reveal how the profitability of local private commercial banks in Bangladesh is affected by their intellectual capital determinants. Secondary sources like annual reports of 10 private conventional commercial banks in Bangladesh were used to get data from 2008 to 2020. This paper uses econometric modeling techniques to examine the relationship between the profitability measures of NIM ratio, ROA, and ROE of the selected private commercial banks and a number of relevant components of intellectual capital of banks such as human capital efficiency, structural capital efficiency and Bank’s relative efficiency along with some bank-specific control variables including income diversification, bank size, bank age, insolvency risks, leverage ratio and market share.Dynamic panel data models were then built using one-step system GMMtechniques to account for endogeneity, unobserved heterogeneity, and profitability persistence of the data set across the chosen time period. This study hasfound that intellectual capital along with leverage ratio, revenue diversification, bank age, bankruptcy risks, and market share are statistically significant to demonstrate differences in NIM, ROA, and ROE measuring profitability of our sampled banks. The one-step system GMM approach has effectively adapted the dynamic effects of intellectual capital on bank profitability, taking into consideration all estimate conditions. A more accurate evaluation of intellectual capital’s effect on the banking industry’s profitability may be obtained in a future research encompassing all banks in Bangladesh.
This paper attempts to investigate the impact of bank-specific determinants on the stock price of... more This paper attempts to investigate the impact of bank-specific determinants on the stock price of Dhaka Stock Exchange (DSE) listed commercial banks in Bangladesh. Several bank-specific factors such as Book to Market Ratio, Return on Equity, Price/Earnings to Growth Ratio, Cash Flow per Share, Debt to Equity Ratio, Earnings per Share, Dividend per Share, Bank Size and Institutional Ownership Percentage have been analyzed for this study and tried to see the impact of each variable on the change in market price of share of 10 listed commercial banks spanning from 2011 to 2020. In empirical discussion four estimation models such as Fixed effects, Random effects, GLS, and Pooled OLS approach have been used to ensure the robustness of the models. To examine the validity of the models chosen for this study, the model specification test and many diagnostic checks were used, including the test of heteroskedasticity, the cross-sectional dependence test, the test of autocorrelation and the unit root test, etc. Our investiagtion reveals that only Bank Size and Book to Market Value explanatory variables are found significantly responsible for fluctuation in the change in share price of banks, contributing to the current literature by revealing the importance of bank-specific factors that include all metrics in their calculation. As a result, Bangladesh’s DSE-listed banks should take appropriate measures to boost their stock values, such as attempting to improve the ratio that has a positive impact on the share price while decreasing the ratio that has a negative impact.
International Journal of Economics and Financial Issues
This paper aims to assess the impact of Cottage, Micro, Small and Medium Enterprises (CMSMEs) fin... more This paper aims to assess the impact of Cottage, Micro, Small and Medium Enterprises (CMSMEs) financing on bank performance estimated with NIM (net interest margin) ratio followed by ROE (return on equity) and ROA (return on assets) ratio considering ten commercial banks (both private and state-owned bank) of Bangladesh being a participant of emerging economy covering from the year 2011 to the year 2020. Adopting Pooled OLS, Fixed Effect (FE), Random Effect (RE) and Generalized Least Square (GLS) technique enables the estimation of coefficients corresponding to the explanatory variables of the models constructed with bank specific as well as macroeconomic control variables along with the CMSME financing factors affecting banks’ profitability. We also use diagnostic tests like the test of heteroskedasticity, multicollinearity, omitted variable, and autocorrelation to ensure our models are accurate. From this paper it will be cleared that the growth of CMSME financing can lead to high...
International Journal of Economics, Finance and Management Sciences, 2015
This Paper is not only a way for getting acknowledged about the efficiency in managing credit ris... more This Paper is not only a way for getting acknowledged about the efficiency in managing credit risk of Bangladeshi Banks, but also a conclusive reference for studying how CRM practices helps to increase profitability and long term sustainability of commercial banks. Credit risk management encompasses identification, measurement, matching mitigations, monitoring and control of the credit risk exposures. For conducting this research, I have to collect secondary data relating to the financial status of Basic Bank Ltd.In my analysis I have divulged a comprehensive overview about CRM in different phase of my report. First, I have described about the CRM practice and performance of BBL. Then, I analyze the impact of CRM on financial performance of bank. I have used Ms Excel as well as SPSS software to compare relationship between CRM and banks profitability. After analysis and discussion I have identified some conclusive findings of my research paper.
International Journal of Economics and Financial Issues
This paper aims to assess the impact of Cottage, Micro, Small and Medium Enterprises (CMSMEs) fin... more This paper aims to assess the impact of Cottage, Micro, Small and Medium Enterprises (CMSMEs) financing on bank performance estimated with NIM (net interest margin) ratio followed by ROE (return on equity) and ROA (return on assets) ratio considering ten commercial banks (both private and state-owned bank) of Bangladesh being a participant of emerging economy covering from the year 2011 to the year 2020. Adopting Pooled OLS, Fixed Effect (FE), Random Effect (RE) and Generalized Least Square (GLS) technique enables the estimation of coefficients corresponding to the explanatory variables of the models constructed with bank specific as well as macroeconomic control variables along with the CMSME financing factors affecting banks’ profitability. We also use diagnostic tests like the test of heteroskedasticity, multicollinearity, omitted variable, and autocorrelation to ensure our models are accurate. From this paper it will be cleared that the growth of CMSME financing can lead to high...
International Journal of Economics and Financial Issues
This paper aims to find out the significant firm-specific and macroeconomic determinants of opera... more This paper aims to find out the significant firm-specific and macroeconomic determinants of operating efficiency through covering 360 observations having 30 commercial banks’ data from 2009 to 2020. Model specification test along with several diagnostic tests has been done and our investigation reveals that Net interest margin or net investment income ratio, loan loss provision to total loan, debt to total assets and total loan to earning assets are significantly related with operating efficiency ratio (OER) bringing the changes in operating efficiency. In the second model, return on equity, net interest margin or net investment income ratio, equity capital to total assets, loan loss provision to total loan, bank size, total loan to earning assets and total loan to total deposit significantly affect the operating efficiency of commercial banks being measured with cost efficiency ratio (CER). In the subsequent model, net interest margin or net investment income ratio, total loan to e...
International Journal of Economics, Finance and Management Sciences, 2017
This paper on the compliance status of Basel-II of a state owned bank will provide a detailed pic... more This paper on the compliance status of Basel-II of a state owned bank will provide a detailed picture of risk management of bank as well as a gross picture of Basel-II implementation status in Bangladesh. This study will also indicate any shortfall of bank in terms of Basel-II compliance and offer suitable recommendations.. In this Paper, I have divulged the calculation of eligible capital, total risk exposure, risk weighted assets and capital adequacy ratio for Agrani Bank Limited. Following the standardized approach to calculate risk weighted assets. I have also shown the impact of Basel II adoption and problems regarding its implementation in banking industry of Bangladesh.
This paper aims to reveal the relationship between the determinants of financial performance and ... more This paper aims to reveal the relationship between the determinants of financial performance and stock performance measured with reference to the Price-Earnings (P/E) ratio. It examines Panel Data of 10 years covering from 2010 to 2019 of seven Private Commercial Banks (PCBs) of Bangladesh enlisted in the Dhaka Stock Exchange (DSE). Several hypotheses and econometric models have been estimated with the Pooled Ordinary Least Squares (Pooled OLS), Generalized Least Squares (GLS), Fixed-effect, and Random-effect, followed by various diagnostic tests to examine the validity of the models selected for this study. Finally, the One-step Generalized Method of Moments (GMM) method has been adopted. The empirical investigation shows that among the entire set of the variables, only the Net Profit Margin (NPM) ratio has a significant impact on the P/E ratio under Random-effect, GLS, and Pooled OLS. Finally, the model developed for the One-step GMM method has revealed that the inclusion of the L...
Recirculating aquaculture system (RAS) is a unique approach that offers total control to culture ... more Recirculating aquaculture system (RAS) is a unique approach that offers total control to culture a wide variety of aquatic species. As capital investment is higher for setting up RAS, it is necessary to conduct an economic feasibility analysis based on real data. A structured questionnaire was used to collect all economic and technical data on two catfish species, viz., Pabda ( Ompok pabda ) and Shing ( Heteropneustes fossilis ), cultured in an RAS farm. The ultimate objective was to estimate net cash flow, net present value (NPV), profitability index (PI), payback period, discounted payback period, internal rate of return (IRR), and sensitivity analysis to find out the best profitability indicators. The analysis revealed that the IRR were 4% and 16% for Pabda and Shing production, respectively. However, for Pabda and Shing productions, the payback periods were 15 years and 4 months and 6 years and 2 months, respectively. The NPV value was positive for Shing production and negative ...
The Journal of Economics and Business is an Open Access publication. It may be read, copied, and ... more The Journal of Economics and Business is an Open Access publication. It may be read, copied, and distributed free of charge according to the conditions of the Creative Commons Attribution 4.0 International license.
This paper attempts to reveal how profitability of non-life insurance companies operating in Bang... more This paper attempts to reveal how profitability of non-life insurance companies operating in Bangladesh are significantly affected by several insurance firm-specific factors such as profit or loss transferred from revenue account to total asset ratio, premium to total asset ratio, operating income to total asset ratio, operating cost to total asset ratio, debt to equity ratio, size of the firm and debt to total asset ratio using econometric modelling showing the causation between ROE (return on equity) being dependent variable measuring profitability and insurance industry specific factors being explanatory variables. Adopting random effect and well as fixed effect method followed by pooled OLS (ordinary least square) and cross-sectional GLS (generalized least square) approach enables us to estimate the coefficients of the models. Under fixed effect method, all the firm specific factors except operating income to total asset ratio are found statistically significant in explaining the variation of ROE followed by Random effect, pooled OLS, and Cross-sectional time series FGLS method showing the statistical significance of all other explanatory variables included in the models except operating cost to total asset ratio. After comparing the outcomes estimated by several models using model specification tests, Pooled OLS and FGLS have revealed the best estimations as per the ramifications of diagnostic checks such as test of heteroskedasticity, muticollinearity, autocorrelation and cross-sectional dependence to check the validity of the models. Keywords: Profitability; ROE; Firm Specific Determinants; Non-life Insurance; Operating Cost
International Journal of Economics, Finance and Management Sciences, 2017
This paper is designed to divulge the financial performance of a selective non-bank financial ins... more This paper is designed to divulge the financial performance of a selective non-bank financial institutions operating in Bangladesh using the ratio analysis of Lanka Bangla Finance Limited. Lanka Bangla Finance Limited is one of the best non-banking financial institutions in Bangladesh. It has become possible due to its proper usage of its resources. In this paper we will be able to find out how they have managed their assets to cover their liabilities. This report will also show why the ratio analysis is so important of a company. To conduct the study, we have collected secondary data from LBFL. This paper is solely based on the ratio analysis segmented in following four broad categories such as Liquidity Ratio, Solvency Ratio, Profitability Ratio and Market Prospect Ratio. We have accumulated in total of 17 ratios included in these four broad categories.
This paper attempts to forecast the economic performance of Bangladesh measured with annual GDP d... more This paper attempts to forecast the economic performance of Bangladesh measured with annual GDP data using an Autoregressive Integrated Moving Average (ARIMA) Model followed by test of goodness of fit using AIC (Akaike Information Criterion) and BIC (Bayesian Information Criterion) index value among six ARIMA models along with several diagnostic tests such as plotting ACF (Autocorrelation Function), PACF (Partial Autocorrelation Function) and performing Unit Root Test of the Residuals estimated by the selected forecasting ARIMA model. We have found the appropriate ARIMA (1,0,1) model useful in predicting the GDP growth of Bangladesh for next couple of years adopting Box-Jenkins approach to construct the ARIMA (p,r,q) model using the GDP data of Bangladesh provided in the World Bank Data stream from 1961 to 2019. JEL classification numbers: B22, B23, C53. Keywords: GDP growth, ACF, PACF, Stationary, ARIMA (p,r,q) model, Forecasting.
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Papers by Raad Lalon