Determinants of banks profitability in Nepal / Navin Kumar Mahatha 

Public ISBD Title : Determinants of banks profitability in Nepal Material Type: printed text Authors: Navin Kumar Mahatha, Author Publication Date: 2017 Size: GRP/Thesis Accompanying material: 8/B Languages : English Descriptors: Bank profits Class number: 338.709 Abstract: Commercial banks play an important role for economic development and foster economic growth by providing number of financial services. One of the important functions of the commercial banks is the financial intermediation functions and thus it transfers the fund from surplus units to the deficit units. It accepts deposits and provides loan and advances to the needed people, institutions and investors. It also invests in several short term and long term projects. Thus, financial sector development plays vital role for appropriate functioning of whole economy. The banks and financial institutions are special components of a healthy and wealthy financial system of the country (Alam et al., 2011). It receives money from those who want to save in the form of deposits and it lends money to those who need it. Banking sector plays the significant role in overall development of the economy in all countries, thus it is said that the banking sector mirrors the larger economy (Singh &Dutta, 2013). Banks motivate people to keep their surplus money as deposits in the bank then bank utilize that money by providing loan to these people who have deficit and need of that fund or by investing that fund in other profitable sector (Selgin, 1988). In the Nepalese financial system, commercial banks are the major mobilizer and disbursers of financial resources. They have all pervasive roles in the growth of a developing country like Nepal. The role of banks in accelerating the economic development of a country like Nepal has been increasingly recognized. They are specially called upon to use their resources to attain social upliftment and speedier economic development (Rai, 2004). Financial sector is regarded as one of the major areas of the economy that plays a vital role in developing nation. A strong financial system promotes investment by financial productive business opportunities, mobilizing savings, efficiently allocating resources and makes easy the trade of goods and services. In Nepal several commercial banks entered in to the business after liberalization in 1989, deregulation advancement in information technology and globalization. Since then financial institutions were free to enter the market. The development in financial sector and bank performance is of great concern in today’s competitive banking industry. Banking Sector development have been a regular feature in the Nepalese financial system, conducted mainly to improve the performance of commercial banks on the one hand and to improve the effectiveness and efficiency of the banking system and the economy in general.The major objective of the study is to analyze the determinants of profitability of commercial banks in Nepal. The specific objectives are as follows:a) to evaluate whether the change in number of bank has significant impact on the ROE and NIM of the commercial banks,b) to evaluate whether the change in interest rate spread of the bank has significant impact on the profitability of the commercial banks. c)to examine the impact of real GDP per capita growth on bank performance, d) To evaluate whether the stock market capitalization to GDP ratio has significant impact on the profitability of the commercial banks. The major purpose of this study is to examine the explanatory power of internal and external variables on performance of Nepalese commercial banks. Specifically, bank competition, GDP growth rate, market interest rate, relative size of the bank, stock market capitalization, cash reserve ratio, bank capital, bank loan and inflation rate on performance of Nepalese commercial banks. The study is based on the secondary data of 21 Nepalese commercial banks for the period of 2009/10 to 2013/14 with a total of 126 observations. The main source of data includes various issues of Banking and Financial Statistics, Quarterly Economic Bulletin and Bank Supervision Report published by Nepal Rastra Bank and annual reports of the selected commercial banks. The pooled cross sectional data analysis has been undertaken in the study. The research design adopted in this study is descriptive and causal comparative research design as it deals with the impact of financial sector development variables on Nepalese commercial banks. The result shows that number of the bank (bank competition), relative size of the bank, stock market capitalization, bank capital and cash reserve ratio are the major factors of that affects the bank performance on Nepalese commercial banks. The result reveals that stock market capitalization have positive relation with bank profitability. This indicates that increase in stock market capitalization leads to increase in profitability of the banks. The results also show that numbers of banks have negative relationship with return on equity, which indicates that more the banks are in the market, lower would be the return on equity. Similarly, bank capital has positive relationship with net interest margin, which indicates that higher the bank capital, higher would be the net interest margin. The regression results show that inflation rate have positive and significant beta coefficient for net interest margin. Likewise, results show that cash reserve ratios have positive and significant relationship with net interest margin. However, relative size of the bank has negative impact on return on equity, this indicates that increase in relative size of the bank leads to decrease in return on equity. Likewise, cash reserve ratio has negative impact on return on equity. Determinants of banks profitability in Nepal [printed text] / Navin Kumar Mahatha, Author . - 2017 . -  ; GRP/Thesis + 8/B. Languages : English Descriptors: Bank profits Class number: 338.709 Abstract: Commercial banks play an important role for economic development and foster economic growth by providing number of financial services. One of the important functions of the commercial banks is the financial intermediation functions and thus it transfers the fund from surplus units to the deficit units. It accepts deposits and provides loan and advances to the needed people, institutions and investors. It also invests in several short term and long term projects. Thus, financial sector development plays vital role for appropriate functioning of whole economy. The banks and financial institutions are special components of a healthy and wealthy financial system of the country (Alam et al., 2011). It receives money from those who want to save in the form of deposits and it lends money to those who need it. Banking sector plays the significant role in overall development of the economy in all countries, thus it is said that the banking sector mirrors the larger economy (Singh &Dutta, 2013). Banks motivate people to keep their surplus money as deposits in the bank then bank utilize that money by providing loan to these people who have deficit and need of that fund or by investing that fund in other profitable sector (Selgin, 1988). In the Nepalese financial system, commercial banks are the major mobilizer and disbursers of financial resources. They have all pervasive roles in the growth of a developing country like Nepal. The role of banks in accelerating the economic development of a country like Nepal has been increasingly recognized. They are specially called upon to use their resources to attain social upliftment and speedier economic development (Rai, 2004). Financial sector is regarded as one of the major areas of the economy that plays a vital role in developing nation. A strong financial system promotes investment by financial productive business opportunities, mobilizing savings, efficiently allocating resources and makes easy the trade of goods and services. In Nepal several commercial banks entered in to the business after liberalization in 1989, deregulation advancement in information technology and globalization. Since then financial institutions were free to enter the market. The development in financial sector and bank performance is of great concern in today’s competitive banking industry. Banking Sector development have been a regular feature in the Nepalese financial system, conducted mainly to improve the performance of commercial banks on the one hand and to improve the effectiveness and efficiency of the banking system and the economy in general.The major objective of the study is to analyze the determinants of profitability of commercial banks in Nepal. The specific objectives are as follows:a) to evaluate whether the change in number of bank has significant impact on the ROE and NIM of the commercial banks,b) to evaluate whether the change in interest rate spread of the bank has significant impact on the profitability of the commercial banks. c)to examine the impact of real GDP per capita growth on bank performance, d) To evaluate whether the stock market capitalization to GDP ratio has significant impact on the profitability of the commercial banks. The major purpose of this study is to examine the explanatory power of internal and external variables on performance of Nepalese commercial banks. Specifically, bank competition, GDP growth rate, market interest rate, relative size of the bank, stock market capitalization, cash reserve ratio, bank capital, bank loan and inflation rate on performance of Nepalese commercial banks. The study is based on the secondary data of 21 Nepalese commercial banks for the period of 2009/10 to 2013/14 with a total of 126 observations. The main source of data includes various issues of Banking and Financial Statistics, Quarterly Economic Bulletin and Bank Supervision Report published by Nepal Rastra Bank and annual reports of the selected commercial banks. The pooled cross sectional data analysis has been undertaken in the study. The research design adopted in this study is descriptive and causal comparative research design as it deals with the impact of financial sector development variables on Nepalese commercial banks. The result shows that number of the bank (bank competition), relative size of the bank, stock market capitalization, bank capital and cash reserve ratio are the major factors of that affects the bank performance on Nepalese commercial banks. The result reveals that stock market capitalization have positive relation with bank profitability. This indicates that increase in stock market capitalization leads to increase in profitability of the banks. The results also show that numbers of banks have negative relationship with return on equity, which indicates that more the banks are in the market, lower would be the return on equity. Similarly, bank capital has positive relationship with net interest margin, which indicates that higher the bank capital, higher would be the net interest margin. The regression results show that inflation rate have positive and significant beta coefficient for net interest margin. Likewise, results show that cash reserve ratios have positive and significant relationship with net interest margin. However, relative size of the bank has negative impact on return on equity, this indicates that increase in relative size of the bank leads to decrease in return on equity. Likewise, cash reserve ratio has negative impact on return on equity.

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Determinants of profitability in Nepalese commercial banks / Neeta Karki 

Public ISBD Title : Determinants of profitability in Nepalese commercial banks Material Type: printed text Authors: Neeta Karki, Author Publication Date: 2016 Pagination: 98p. Size: GRP/Thesis Accompanying material: 6/B Languages : English Descriptors: Business enterprises Class number: 338.709 Abstract: The banking system plays one of the major roles of transferring funds from the saving units to the investing units. If a financial system is efficient, it should show improvements in profitability, increase the volume of funds flowing from saver to borrowers, and provide better quality services for consumers. The financial intermediation provided by the banking sector supports economic acceleration by converting deposits into productive investments (Levine et al., 2000). During the last few decades, advancement in technologies have allowed the banking sector to take advantage of this, showing a worldwide improvement in its profitability not only in bank-oriented countries like those in Eastern and Central Europe but also in market-oriented countries like the US (Berger & Bonaccorsi, 2006). The major objective of this study is to examine the determinants of commercial banks profitability in Nepal. The study has the following specific objectives: to analyze the structure and pattern of dependent variables (ROA and ROE) and independent variables (NIM, CAR, NPL and credit to deposit), to find out the relationship between banks specific factors (CAR, NIM, NPL and credit to deposit) and banks performance (ROA and ROE), to examine impact of capital adequacy ratios and assets quality on financial performance of the banks and to determine the major factors influencing the performance of Nepalese commercial banks. This study is based on secondary sources of data that are collected for the commercial banks of Nepal. The banks which are in operation from last six years have been selected as the sample of the study. There are 28 commercial banks operating in Nepal consisting 3 public sector banks, 6 joint venture banks and 19 private sector banks. Among these, twenty-four commercial banks are taken for the study to compare the performance of commercial banks. The study is based on descriptive and causal comparative research designs. The result shows NIM and NPLTL have negative relationship with ROA of public sector banks. This indicates that higher he NIM and NPLTL, lower would be ROA. However, CDR and CAR have positive relationship with ROA of public sector banks. Similarly, capital adequacy ratio has negative relationship with the performance (ROA and ROE) of joint venture banks. However, NPLTL, NIM and CDR have viii positive relationship with the performance. The results indicated that NPLTL has a negative relationship with performance (ROA and ROE) of Nepalese commercial banks. However, NIM, CDR and CAR have a positive relationship with the performance of Nepalese private banks. The findings revealed that for private domestic banks beta coefficients are positive for CAR, NIM and CDR. Thus, the result indicates that increase in NIM, leads to higher ROA. Similarly, higher the CDR and CAR has a significant and positive impact on ROA. The regression of return on assets for private domestic banks revealed that beta coefficients are negative for NPLTL. The NPLTL is significant at 1 percent level of significance which indicates that larger the NPLTL, lower would be ROA. Finally, the result indicates that higher the NIM, higher would be the ROE. The regression of return on equity shows that beta coefficients are negative for CAR, NPLTL and CDR. The result indicates that higher the CAR and NPLTL, lower would be ROE of the Nepalese private domestic banks. Similarly, higher the CDR, lower would be ROE. The study concludes that nonperforming loan to total loans and credit to deposit ratio are the major factors affecting the performance measured in terms of return on assets and return on equity in Nepalese commercial banks. Thus, higher the capital adequacy ratio, net interest margin and credit to deposit ratio, higher would be the performance (ROA) of Nepalese public sector banks. The study also concludes that higher the nonperforming loan to total loans, lower would be the performance (ROA and ROE) of Nepalese private domestic commercial banks. Likewise, increase in credit to deposit ratio leads to increase in performance of Nepalese joint venture banks. Determinants of profitability in Nepalese commercial banks [printed text] / Neeta Karki, Author . - 2016 . - 98p. ; GRP/Thesis + 6/B. Languages : English Descriptors: Business enterprises Class number: 338.709 Abstract: The banking system plays one of the major roles of transferring funds from the saving units to the investing units. If a financial system is efficient, it should show improvements in profitability, increase the volume of funds flowing from saver to borrowers, and provide better quality services for consumers. The financial intermediation provided by the banking sector supports economic acceleration by converting deposits into productive investments (Levine et al., 2000). During the last few decades, advancement in technologies have allowed the banking sector to take advantage of this, showing a worldwide improvement in its profitability not only in bank-oriented countries like those in Eastern and Central Europe but also in market-oriented countries like the US (Berger & Bonaccorsi, 2006). The major objective of this study is to examine the determinants of commercial banks profitability in Nepal. The study has the following specific objectives: to analyze the structure and pattern of dependent variables (ROA and ROE) and independent variables (NIM, CAR, NPL and credit to deposit), to find out the relationship between banks specific factors (CAR, NIM, NPL and credit to deposit) and banks performance (ROA and ROE), to examine impact of capital adequacy ratios and assets quality on financial performance of the banks and to determine the major factors influencing the performance of Nepalese commercial banks. This study is based on secondary sources of data that are collected for the commercial banks of Nepal. The banks which are in operation from last six years have been selected as the sample of the study. There are 28 commercial banks operating in Nepal consisting 3 public sector banks, 6 joint venture banks and 19 private sector banks. Among these, twenty-four commercial banks are taken for the study to compare the performance of commercial banks. The study is based on descriptive and causal comparative research designs. The result shows NIM and NPLTL have negative relationship with ROA of public sector banks. This indicates that higher he NIM and NPLTL, lower would be ROA. However, CDR and CAR have positive relationship with ROA of public sector banks. Similarly, capital adequacy ratio has negative relationship with the performance (ROA and ROE) of joint venture banks. However, NPLTL, NIM and CDR have viii positive relationship with the performance. The results indicated that NPLTL has a negative relationship with performance (ROA and ROE) of Nepalese commercial banks. However, NIM, CDR and CAR have a positive relationship with the performance of Nepalese private banks. The findings revealed that for private domestic banks beta coefficients are positive for CAR, NIM and CDR. Thus, the result indicates that increase in NIM, leads to higher ROA. Similarly, higher the CDR and CAR has a significant and positive impact on ROA. The regression of return on assets for private domestic banks revealed that beta coefficients are negative for NPLTL. The NPLTL is significant at 1 percent level of significance which indicates that larger the NPLTL, lower would be ROA. Finally, the result indicates that higher the NIM, higher would be the ROE. The regression of return on equity shows that beta coefficients are negative for CAR, NPLTL and CDR. The result indicates that higher the CAR and NPLTL, lower would be ROE of the Nepalese private domestic banks. Similarly, higher the CDR, lower would be ROE. The study concludes that nonperforming loan to total loans and credit to deposit ratio are the major factors affecting the performance measured in terms of return on assets and return on equity in Nepalese commercial banks. Thus, higher the capital adequacy ratio, net interest margin and credit to deposit ratio, higher would be the performance (ROA) of Nepalese public sector banks. The study also concludes that higher the nonperforming loan to total loans, lower would be the performance (ROA and ROE) of Nepalese private domestic commercial banks. Likewise, increase in credit to deposit ratio leads to increase in performance of Nepalese joint venture banks.

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Determinants of profitability of commercial banks in Nepal / Sangeeta Shrestha 

Public ISBD Title : Determinants of profitability of commercial banks in Nepal Material Type: printed text Authors: Sangeeta Shrestha, Author Publication Date: 2013 Pagination: 92p. Size: GRP/Thesis Accompanying material: 1/B General note: Including bibliography Languages : English Descriptors: Bank profits Banks and banking Commercial banks Nepal Profit Keywords: 'profitability  profits  banks  banks and banking  commercial banks  nepal  sangeeta shrestha  profit' Class number: 338.709 Determinants of profitability of commercial banks in Nepal [printed text] / Sangeeta Shrestha, Author . - 2013 . - 92p. ; GRP/Thesis + 1/B. Including bibliography Languages : English Descriptors: Bank profits Banks and banking Commercial banks Nepal Profit Keywords: 'profitability  profits  banks  banks and banking  commercial banks  nepal  sangeeta shrestha  profit' Class number: 338.709

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Determinants of profitability of Nepalese commercial banks / Pradeep Maharjan 

Public ISBD Title : Determinants of profitability of Nepalese commercial banks Material Type: printed text Authors: Pradeep Maharjan, Author Publication Date: 2016 Pagination: 94p. Size: GRP/Thesis Accompanying material: 7/B Languages : English Descriptors: Business enterprises Class number: 338.709 Abstract: A bank is financial institution and a financial intermediary that accepts deposits and channels those deposits into lending activities. In the process of taking deposits and lending, the interest rate is discovered by paying lower interest rate to depositors and receiving higher interest rate from borrower in order to retain profitability. Banks are such types of business where deposits are considered as liabilities and issuing debt securities are considered as assets on the other part (Fama, 1980). The primary function of bank taking deposits and providing loan are always run with main motive to generate profitability. Banks make a profit by intermediating between depositors and borrowers (Acaravci and Calim, 2013). Profitability is simply the difference between total revenues and total cost. Therefore, the factors which affect the bank profitability would be those that affect the bank’s revenue and cost. Hence, the impact of internal and external determinants of commercial bank profitability is analyzed with view to show their impact on bank profitability. This study focuses on the dependent variable namely bank profitability which has been measured in term of return on assets, return on equity and net interest margin. This study examines the determinants of profitability of Nepalese commercial banks with respect to banks specific variables and macroeconomic variables. The specific objectives of this study is to analyze the relationship and impact of capital adequacy, credit risk, liquidity position, bank size, inflation and gross domestic product growth rate on bank profitability. The study has selected 19 Nepalese commercial banks. The research is based on secondary data and the data were collected from bank supervision report published by Nepal rastra bank and annual report of banks. The methods used for secondary data analysis included descriptive analysis, correlation analysis and regression analysis. The study results show that Lumbini bank has the highest average return on assets. Similarly, average return on equity is largest for Nabil bank. Agricultural development ban has the highest average net interest margin. There is positive relationship of capital adequacy and credit risk with Nepalese commercial banks profit in term of return of assets, return on equity and net interest margin. It indicates higher the capital adequacy ratio, higher would be Nepalese commercials banks profit. Similarly, increase in credit risk will increase the bank profit. Similarly, bank size is positively related with bank profitability. It reveals that higher the bank size, higher would be bank profitability. Likewise, liquidity position has negative relationship with Nepalese commercial bank’s profit. It indicates higher holding of liquidity position leads to lower profit and vice-versa. Inflation and gross domestic product growth rate have positive relationship with both return on assets and return on equity. It indicates higher the inflation, higher would be would be return on assets and return on equity. It also reveals that increase in gross domestic product growth rate increases the return on assets and return on equity. However, there is negative relationship of inflation and gross domestic product growth rate with net interest margin which indicates lower inflation leads to higher net interest margin and vice-versa. It also indicates that higher the gross domestic product, lower would be net interest margin. Determinants of profitability of Nepalese commercial banks [printed text] / Pradeep Maharjan, Author . - 2016 . - 94p. ; GRP/Thesis + 7/B. Languages : English Descriptors: Business enterprises Class number: 338.709 Abstract: A bank is financial institution and a financial intermediary that accepts deposits and channels those deposits into lending activities. In the process of taking deposits and lending, the interest rate is discovered by paying lower interest rate to depositors and receiving higher interest rate from borrower in order to retain profitability. Banks are such types of business where deposits are considered as liabilities and issuing debt securities are considered as assets on the other part (Fama, 1980). The primary function of bank taking deposits and providing loan are always run with main motive to generate profitability. Banks make a profit by intermediating between depositors and borrowers (Acaravci and Calim, 2013). Profitability is simply the difference between total revenues and total cost. Therefore, the factors which affect the bank profitability would be those that affect the bank’s revenue and cost. Hence, the impact of internal and external determinants of commercial bank profitability is analyzed with view to show their impact on bank profitability. This study focuses on the dependent variable namely bank profitability which has been measured in term of return on assets, return on equity and net interest margin. This study examines the determinants of profitability of Nepalese commercial banks with respect to banks specific variables and macroeconomic variables. The specific objectives of this study is to analyze the relationship and impact of capital adequacy, credit risk, liquidity position, bank size, inflation and gross domestic product growth rate on bank profitability. The study has selected 19 Nepalese commercial banks. The research is based on secondary data and the data were collected from bank supervision report published by Nepal rastra bank and annual report of banks. The methods used for secondary data analysis included descriptive analysis, correlation analysis and regression analysis. The study results show that Lumbini bank has the highest average return on assets. Similarly, average return on equity is largest for Nabil bank. Agricultural development ban has the highest average net interest margin. There is positive relationship of capital adequacy and credit risk with Nepalese commercial banks profit in term of return of assets, return on equity and net interest margin. It indicates higher the capital adequacy ratio, higher would be Nepalese commercials banks profit. Similarly, increase in credit risk will increase the bank profit. Similarly, bank size is positively related with bank profitability. It reveals that higher the bank size, higher would be bank profitability. Likewise, liquidity position has negative relationship with Nepalese commercial bank’s profit. It indicates higher holding of liquidity position leads to lower profit and vice-versa. Inflation and gross domestic product growth rate have positive relationship with both return on assets and return on equity. It indicates higher the inflation, higher would be would be return on assets and return on equity. It also reveals that increase in gross domestic product growth rate increases the return on assets and return on equity. However, there is negative relationship of inflation and gross domestic product growth rate with net interest margin which indicates lower inflation leads to higher net interest margin and vice-versa. It also indicates that higher the gross domestic product, lower would be net interest margin.

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The effect of financial performance indicators on market price per share and stock return of Nepalese commercial banks / Manjari Shrestha 

Public ISBD Title : The effect of financial performance indicators on market price per share and stock return of Nepalese commercial banks Material Type: printed text Authors: Manjari Shrestha, Author Publication Date: 2017 Pagination: 69p. Size: GRP/Thesis Accompanying material: 8/B Languages : English Descriptors: Business enterprises - Finance Class number: 338.709 Abstract: Banking sector plays a significant role in channelling funds to industries and contributing towards economic and financial growth and stability. A well-established banking sector can absorb major financial crisis in the economy and can provide a plat form for strengthening then economic system of the country (Aburime, 2009). During the last two decades the banking sector has experienced worldwide major transformation in its operating environment. Both external and domestic factors have affected its structure and performance (Fungacova and Poghosyan, 2011). Bank performance is the reflection of the way in which the resources of a bank are used in a form which enables it to achieve its objectives. Furthermore, the term bank performance means the adoption of the set of indicators which are indicative of the bank current status and the extent of its ability to achieve the desired objectives. In this study, the possible variables determining the performance of the commercial banks are identified and studied extensively. A profitable and sound banking sector is at a better point to endure adverse upsets and adds performance in the financial system (Athanasoglou et al., 2008). The stock market plays an important role in economic development by promoting capital formation and raising economic growth through trading on securities in the market (Nisa and Nishat, 2011). The study emphasized that trading of securities in this market facilitates savers and users of capital by fund pooling, risk sharing, and transfer of wealth. Inyiama and Nwoha (2014) stated that firm’s financial performance and businesses are in turn influenced by general economic conditions, the performance of the financial markets, inflationary rates, money supply, interest rates, foreign currency exchange rates, changes in laws, regulations and policies of the central bank, capital market and other regulators as well as competitive factors on a global, federal, state and local government basis. The main objective of the study is to examine the effect of financial performance indicators on market price per share and stock return in Nepalese commercial banks. The study is based on secondary data of 17 commercial banks with 135 observations for the period of 2007/08to 2014/15. The data for bank specific variables have been obtained from financial statements of the sample banks, recorded in the database of Nepal Stock Exchange (NEPSE) Limited and Securities Board of Nepal (SEBON).The research design adopted in this study is descriptive and causal comparative research design as it deals with analyzing the effect of financial performance indicators on market price per share and stock return of commercial banks. The result shows that the average market price per share is highest for SCBL (Rs 3285) and lowest for SRBL (Rs.213.75). The average stock returns are highest for NBB and MBL (27.47 percent) and lowest for SCBL (-5.68 percent). the average excess returns are highest for NBB (23.11 percent) and lowest for SCBL (-10 percent). SCBL has the highest dividend per share of Rs.69.53 and NBB has the lowest i.e. Rs 5.62. The average return on assets is largest for NBB (5.45 percent) and lowest for MBL (0.6 percent). Likewise, the average return on equity is highest for NBB (43.28 percent) and lowest for KBL (6.93 percent). NBB has highest average earning price ratio of 16.03 percent whereas it is lowest for MBL i.e. 2.05 percent. The average leverage is highest for SBI (93.15 percent) and lowest for SRBL (78.86 percent). NBB has the highest book to market ratio of 48.01 percent whereas SCB has lowest i.e. 10.35 percent. Similarly, the average firm size is largest for Nabil (Rs. 24.46 billion) and lowest for SRBL (Rs. 16.81 billion). The descriptive statistics shows that market price per share ranges from Rs.107 to Rs. 6830.00, leading to an average market price per share of Rs. 952.65 while the stock return varies from negative 72.03 percent to 204.93 percent, leading to an average stock return of 7.85 percent. While the excess return varies from negative 78.09 percent to 204.17 percent, leading to an average excess return of 3.49 percent. The average dividend per share is noticed to be Rs. 21.98 with a minimum of Rs. 0.0 and a maximum of Rs. 130. Likewise, return on assets ranges from -0.99 percent to 18.04 percent, leading to an average of 1.87 percent. Return on equity has a minimum of negative 6.14 percent and a maximum of 193.35 percent, leading to an average of 20.25 percent. Firm size ranges from Rs. 21.34 billion to Rs. 25.07 billion, leading to an average firm size to Rs. 23.10billion. The average earning price ratio is noticed to be 5.38 percent with a minimum of 0.0 percent and a maximum of 41.43 percent. Similarly, the average leverage is noticed to be 90.47 percent with a minimum of 76.70 percent and a maximum of 96.42 percent. Moreover, the average book to market ratio is noticed to be 31.05 percent with a minimum of 5.45 percent and a maximum of 121.49 percent. The result shows that dividend per share, return on assets, return on equity, leverage and firm size are positively related to market price per share. Whereas, book to market ratio and earning price ratio are negatively related with market price per share. Dividend per share and firm size are positively related with stock return and excess return. Whereas, return on assets, return on equity, book to market ratio, earning price ratio and leverage are negatively related with stock return and excess return. The beta coefficient for dividend per share, return on equity, leverage and firm size are positive and significant with market price per share. However, the beta coefficient for earning price ratio and book to market ratio are negative and significant with market price per share. The beta coefficients are positive and significant for dividend per share and firm size with stock return. Whereas, earning price ratio and book to market ratio have negative impact on stock return and significant at 5 percent level of significance. The beta coefficients are positive for dividend per share and firm size with excess return. However, the beta coefficient for firm size is only significant at 5 percent level of significance with excess return. The beta coefficient for earning price ratio and book to market ratio are negative with excess return. However, the beta coefficient for earning price ratio is only significant at 5 percent level of significance with excess return. The effect of financial performance indicators on market price per share and stock return of Nepalese commercial banks [printed text] / Manjari Shrestha, Author . - 2017 . - 69p. ; GRP/Thesis + 8/B. Languages : English Descriptors: Business enterprises - Finance Class number: 338.709 Abstract: Banking sector plays a significant role in channelling funds to industries and contributing towards economic and financial growth and stability. A well-established banking sector can absorb major financial crisis in the economy and can provide a plat form for strengthening then economic system of the country (Aburime, 2009). During the last two decades the banking sector has experienced worldwide major transformation in its operating environment. Both external and domestic factors have affected its structure and performance (Fungacova and Poghosyan, 2011). Bank performance is the reflection of the way in which the resources of a bank are used in a form which enables it to achieve its objectives. Furthermore, the term bank performance means the adoption of the set of indicators which are indicative of the bank current status and the extent of its ability to achieve the desired objectives. In this study, the possible variables determining the performance of the commercial banks are identified and studied extensively. A profitable and sound banking sector is at a better point to endure adverse upsets and adds performance in the financial system (Athanasoglou et al., 2008). The stock market plays an important role in economic development by promoting capital formation and raising economic growth through trading on securities in the market (Nisa and Nishat, 2011). The study emphasized that trading of securities in this market facilitates savers and users of capital by fund pooling, risk sharing, and transfer of wealth. Inyiama and Nwoha (2014) stated that firm’s financial performance and businesses are in turn influenced by general economic conditions, the performance of the financial markets, inflationary rates, money supply, interest rates, foreign currency exchange rates, changes in laws, regulations and policies of the central bank, capital market and other regulators as well as competitive factors on a global, federal, state and local government basis. The main objective of the study is to examine the effect of financial performance indicators on market price per share and stock return in Nepalese commercial banks. The study is based on secondary data of 17 commercial banks with 135 observations for the period of 2007/08to 2014/15. The data for bank specific variables have been obtained from financial statements of the sample banks, recorded in the database of Nepal Stock Exchange (NEPSE) Limited and Securities Board of Nepal (SEBON).The research design adopted in this study is descriptive and causal comparative research design as it deals with analyzing the effect of financial performance indicators on market price per share and stock return of commercial banks. The result shows that the average market price per share is highest for SCBL (Rs 3285) and lowest for SRBL (Rs.213.75). The average stock returns are highest for NBB and MBL (27.47 percent) and lowest for SCBL (-5.68 percent). the average excess returns are highest for NBB (23.11 percent) and lowest for SCBL (-10 percent). SCBL has the highest dividend per share of Rs.69.53 and NBB has the lowest i.e. Rs 5.62. The average return on assets is largest for NBB (5.45 percent) and lowest for MBL (0.6 percent). Likewise, the average return on equity is highest for NBB (43.28 percent) and lowest for KBL (6.93 percent). NBB has highest average earning price ratio of 16.03 percent whereas it is lowest for MBL i.e. 2.05 percent. The average leverage is highest for SBI (93.15 percent) and lowest for SRBL (78.86 percent). NBB has the highest book to market ratio of 48.01 percent whereas SCB has lowest i.e. 10.35 percent. Similarly, the average firm size is largest for Nabil (Rs. 24.46 billion) and lowest for SRBL (Rs. 16.81 billion). The descriptive statistics shows that market price per share ranges from Rs.107 to Rs. 6830.00, leading to an average market price per share of Rs. 952.65 while the stock return varies from negative 72.03 percent to 204.93 percent, leading to an average stock return of 7.85 percent. While the excess return varies from negative 78.09 percent to 204.17 percent, leading to an average excess return of 3.49 percent. The average dividend per share is noticed to be Rs. 21.98 with a minimum of Rs. 0.0 and a maximum of Rs. 130. Likewise, return on assets ranges from -0.99 percent to 18.04 percent, leading to an average of 1.87 percent. Return on equity has a minimum of negative 6.14 percent and a maximum of 193.35 percent, leading to an average of 20.25 percent. Firm size ranges from Rs. 21.34 billion to Rs. 25.07 billion, leading to an average firm size to Rs. 23.10billion. The average earning price ratio is noticed to be 5.38 percent with a minimum of 0.0 percent and a maximum of 41.43 percent. Similarly, the average leverage is noticed to be 90.47 percent with a minimum of 76.70 percent and a maximum of 96.42 percent. Moreover, the average book to market ratio is noticed to be 31.05 percent with a minimum of 5.45 percent and a maximum of 121.49 percent. The result shows that dividend per share, return on assets, return on equity, leverage and firm size are positively related to market price per share. Whereas, book to market ratio and earning price ratio are negatively related with market price per share. Dividend per share and firm size are positively related with stock return and excess return. Whereas, return on assets, return on equity, book to market ratio, earning price ratio and leverage are negatively related with stock return and excess return. The beta coefficient for dividend per share, return on equity, leverage and firm size are positive and significant with market price per share. However, the beta coefficient for earning price ratio and book to market ratio are negative and significant with market price per share. The beta coefficients are positive and significant for dividend per share and firm size with stock return. Whereas, earning price ratio and book to market ratio have negative impact on stock return and significant at 5 percent level of significance. The beta coefficients are positive for dividend per share and firm size with excess return. However, the beta coefficient for firm size is only significant at 5 percent level of significance with excess return. The beta coefficient for earning price ratio and book to market ratio are negative with excess return. However, the beta coefficient for earning price ratio is only significant at 5 percent level of significance with excess return.

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Barcode	Call number	Media type	Location	Section	Status
284/D	338.709 SHR	Thesis/Dissertation	Uniglobe Library	Social Sciences	Available

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