The Impact of Financial Variables on Firm Profitability: An Empirical Study of Commercial Banks in Oman

• 발행기관: 한국유통과학회
• 저자명: Gopu JAYARAMAN Imran AZAD Hanaa Sid AHMED
• 간행물 정보: 『The Journal of Asian Finance, Economics and Business(JAFEB)』Vol. 8 No.5, 885~896쪽, 전체 12쪽
• 주제분류: 경제경영 > 경제학
• 파일형태: PDF
• 발행일자: 2021.05.30

영문 초록

The general role of commercial banks is to provide financial services to the general public and business, ensuring economic and social stability and sustainable growth of the economy. Commercial banks play an important role in mobilizing and channelizing funds for investment activities. This study analyzes the impact of the key financial variables on the net profit of the selected commercial banks in Oman. The study employs times series panel data – cross-sectional analysis of the key financials of five leading commercial banks for a period of 13 years from 2007 to 2019. The results reveal that the correlation matrix of the selected variables has a positive relationship with net profit, assets, deposits, loans, and interest income. However, the findings also shows a negative relationship between net profit and net loans to total deposits ratio. The study found net loans is the main independent variable that influences the profitability of the banks since the key source of revenue comes from the lending operations. The assets, total capital adequacy ratio have a mixed effect on the profitability of commercial banks. The total deposits and capital adequacy ratio have a negative effect on profitability mainly because excessive liquidity will increase the cost of capital and reduce the return on investment. Focusing on lending operations with a sound credit portfolio will improve profitability.

목차

1. Introduction

2. Theoretical Background

3. Statement of the Problem

4. Objectives and Research Questions

5. Methodology

6. Results and Discussion

7. Conclusion

키워드

Net Profit Net Interest Income Net Loans Total Assets Deposits