Volume : 4, Issue : 4, April - 2015
An empirical study on the determinant factors of Ethiopian commercial banks profitability
Dr. Pentela Fareed Mastan
Abstract :
<p> This study is focused on examining the impact of bank–specific, industry– specific and macroeconomic determinants of </p> <div>Ethiopian commercial banks profitability with balanced panel data of seven Ethiopian commercial banks that covers </div> <div>the period 2001– 2010. The paper used Ordinary Least Square (OLS) technique to investigate the impact of capital, size, </div> <div>loan, deposits, noninterest income, noninterest expense, credit risk, market concentration, economic growth, inflation and saving interest rate </div> <div>on major profitability indicator i.e., return on asset (ROA). The estimation results show that all bank–specific determinants, with the exception </div> <div>of saving deposit, significantly affect commercial banks profitability in Ethiopia. Market concentration is also a significant determining </div> <div>factor of profitability. Finally, concerning to macroeconomic variables, only economic growth exhibits a significant relationship with banks’ </div> <div>profitability. The results are useful to both academics and policy makers</div>
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Download PDF Journal DOI : 10.15373/2249555XCite This Article:
Dr.Pentela Fareed Mastan An empirical study on the determinant factors of Ethiopian commercial banks profitability Global Journal For Research Analysis, Vol: 4, Issue: 4 April 2015