Impact of Capital Adequacy and Bank Operational Efficiency on Profitability of Nepalese Commercial Bank

International Journal of Economics and Management Studies

© 2019 by SSRG - IJEMS Journal

Volume 6 Issue 8

Year of Publication : 2019

Authors : Santosh Kr. Gautam

10.14445/23939125/IJEMS-V6I8P122

How to Cite?

Santosh Kr. Gautam, "Impact of Capital Adequacy and Bank Operational Efficiency on Profitability of Nepalese Commercial Bank," SSRG International Journal of Economics and Management Studies, vol. 6,  no. 8, pp. 213-218, 2019. Crossref, https://doi.org/10.14445/23939125/IJEMS-V6I8P122

Abstract:

This paper examines the impact of capital adequacy and bank operational efficiency on profitability of Nepalese commercial banks. Descriptive and fixed effect regression was used to analyze the data. The study is conducted using panel data of 9 commercial banks operated in Nepal with 90 observations for the period 2007/08 to 2016/17. The dependent variable is return on asset while the independent variables are capital adequacy ratio, operation efficiency, loan to deposit, bank size and equity ratio. The study revealed that CAR and OEOI has negative significant relation whereas, EQR has positive significant relation with the profitability of sampled commercial bank.

Keywords:

Profitability, Commercial bank, Capital Adequacy, Operational Efficiency.

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