Capital structure and bank performance of commercial bank in Nepal

International Journal of Economics and Management Studies

© 2019 by SSRG - IJEMS Journal

Volume 6 Issue 6

Year of Publication : 2019

Authors : Bikash Acharya

10.14445/23939125/IJEMS-V6I6P109

How to Cite?

Bikash Acharya, "Capital structure and bank performance of commercial bank in Nepal," SSRG International Journal of Economics and Management Studies, vol. 6,  no. 6, pp. 53-58, 2019. Crossref, https://doi.org/10.14445/23939125/IJEMS-V6I6P109

Abstract:

This study has been conducted to examine the determinants of capital structure of Nepalese commercial banks. Eleven commercial banks have been selected for the study based on availability of data. This study has been conducted with the secondary data obtained from the financial statements, annual publications of NRB and even from the official website of respective banks for period 2008-2015. Four independent variables total debt to equity ratio, long term debt to assets, short term debt to assets and total debt to assets have been included.Profitability is the dependent variable and measured by the return on assets (ROA) and return on equity (ROE). To determine the variables, previous studies particularly ofZafar, Zeeshan, & Ahmed (2016) and Ghosh(2007) have been consulted. A descriptive research design has been adopted for the study. Different descriptive statistical measures such as minimum, maximum, percentage, average, standard deviation and coefficient of variation have been used to analyse. A multiple regression model has been applied for analysing the data.The study reveals that long term debt to asset, total debt to asset and total debt to total equity are statistically significant to ROE and ROA.

Keywords:

Capital structure, commercial banks, secondary data, profitability, descriptive and inferential analysis.

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