Corporate payout policy and market capitalization:a case of Nepalese commercial banks / Anita Kumari Luitel

Public ISBD Title : Corporate payout policy and market capitalization:a case of Nepalese commercial banks Material Type: printed text Authors: Anita Kumari Luitel, Author Publication Date: 2018 Pagination: 90p. Size: GRP/Thesis Accompanying material: 10/B Languages : English Descriptors: Corporations -Finance Dividends Class number: 332.6322 Abstract: Dividend is the result of a discretionary decision made by the board of directors of a firm. Generally, a firm announces dividend on the profit. Corporate dividend policy is one of the most enduring issues in modern corporate finance. The shareholders should be indifferent between amount distributed and retained in the firm (Miller and Modigliani, 1961). Firms view dividend policy very important because it determines what funds flow to investors and what funds are retained by the firm for reinvestment. Shareholders always look at the capability of the companies to initiate a dividend. Corporate dividend policy has very important role in determining the market value of the company. A group of studies has argued that corporate dividend policy leads to increase the wealth of shareholders through its influence on the firm’s stock price and hence increases firm value (e.g. Gordon, 1963; and Salih, 2010). Another group has argued that dividend payments lead to decrease the wealth of shareholders by reducing stock price and hence decreasing firm value (Pettit, 1972). The last group has adopted the notion of irrelevance of dividend policy, i.e. for stock prices and hence firm value is not affected by corporate dividend policy (e.g. Miller and Modigliani, 1961; Baker et. al. 1985 and Farrelly et. al. 1986). The major purpose of this study is to investigate the relationship between corporate dividend pay-out and market capitalization of the Nepalese commercial banks. The specific objectives are (a) to examine the structure and pattern of market price per share and market capitalization of the Nepalese commercial banks, (b) to find out the relation of dividend yield, dividend payout ratio, size, leverage, gross domestic product growth and earnings per share with market price per share in Nepalese commercial banks, (c) to analyze the relation of bank’s dividend payout ratio with market capitalization in Nepalese commercial banks and (d) to find out the most important factors of leverage and dividend yield affecting the market price per share of Nepalese commercial banks. The study is based on descriptive and causal-comparative research designs. The descriptive research has been adopted to undertake fact-finding operation searching for adequate information about the impact of corporate payout policy on the market capitalization of Nepalese commercial banks. Moreover, this study also emphasizes on cause and effect relationship between dividend and other factors and the market capitalization of commercial banks in Nepalese context. This study is based on the cross sectional secondary data which are gathered from 18 commercial banks in Nepal. The total numbers of observations is 126. The main sources of data are supervision reports of NRB and various annual reports of different commercial banks along with the publications of the World Bank. The data are collected for market price per share, market capitalization per year, total assets, dividend yield, dividend payout ratio, leverage, gross domestic product growth and earnings per share. These data are collected for the period 2009/10-2015/16. The results show that market price per share and market capitalization has a positive relationship with size of the banks, dividend payout ratio, leverage, earnings per share and gross domestic product growth rate. Dividend yield has been found to have a negative relationship with market price per share and market capitalization. The results reveal that beta coefficients of size of banks, dividend payout ratio, leverage, gross domestic product growth and earnings per share are positive and significant for the overall market capitalization and market price per share of Nepalese commercial bank which implies that higher the size of banks, dividend payout ratio, leverage, gross domestic product growth and earnings per share result in higher market capitalization and market price per share of the Nepalese commercial banks. All the results are significant. The major conclusion of the study is the corporate payout policy of Nepalese commercial banks represented mainly by dividend yield, dividend payout ratio and earnings per share has a crucial impact on the market capitalization of Nepalese commercial banks. Other than that size, leverage and GDP have also significant impact on the market capitalization of Nepalese commercial banks. More specifically, size of the banks, dividend payout ratio, leverage, gross domestic product growth and earnings per share impacts positively and significantly to the market capitalization. Corporate payout policy and market capitalization:a case of Nepalese commercial banks [printed text] / Anita Kumari Luitel, Author . - 2018 . - 90p. ; GRP/Thesis + 10/B. Languages : English Descriptors: Corporations -Finance Dividends Class number: 332.6322 Abstract: Dividend is the result of a discretionary decision made by the board of directors of a firm. Generally, a firm announces dividend on the profit. Corporate dividend policy is one of the most enduring issues in modern corporate finance. The shareholders should be indifferent between amount distributed and retained in the firm (Miller and Modigliani, 1961). Firms view dividend policy very important because it determines what funds flow to investors and what funds are retained by the firm for reinvestment. Shareholders always look at the capability of the companies to initiate a dividend. Corporate dividend policy has very important role in determining the market value of the company. A group of studies has argued that corporate dividend policy leads to increase the wealth of shareholders through its influence on the firm’s stock price and hence increases firm value (e.g. Gordon, 1963; and Salih, 2010). Another group has argued that dividend payments lead to decrease the wealth of shareholders by reducing stock price and hence decreasing firm value (Pettit, 1972). The last group has adopted the notion of irrelevance of dividend policy, i.e. for stock prices and hence firm value is not affected by corporate dividend policy (e.g. Miller and Modigliani, 1961; Baker et. al. 1985 and Farrelly et. al. 1986). The major purpose of this study is to investigate the relationship between corporate dividend pay-out and market capitalization of the Nepalese commercial banks. The specific objectives are (a) to examine the structure and pattern of market price per share and market capitalization of the Nepalese commercial banks, (b) to find out the relation of dividend yield, dividend payout ratio, size, leverage, gross domestic product growth and earnings per share with market price per share in Nepalese commercial banks, (c) to analyze the relation of bank’s dividend payout ratio with market capitalization in Nepalese commercial banks and (d) to find out the most important factors of leverage and dividend yield affecting the market price per share of Nepalese commercial banks. The study is based on descriptive and causal-comparative research designs. The descriptive research has been adopted to undertake fact-finding operation searching for adequate information about the impact of corporate payout policy on the market capitalization of Nepalese commercial banks. Moreover, this study also emphasizes on cause and effect relationship between dividend and other factors and the market capitalization of commercial banks in Nepalese context. This study is based on the cross sectional secondary data which are gathered from 18 commercial banks in Nepal. The total numbers of observations is 126. The main sources of data are supervision reports of NRB and various annual reports of different commercial banks along with the publications of the World Bank. The data are collected for market price per share, market capitalization per year, total assets, dividend yield, dividend payout ratio, leverage, gross domestic product growth and earnings per share. These data are collected for the period 2009/10-2015/16. The results show that market price per share and market capitalization has a positive relationship with size of the banks, dividend payout ratio, leverage, earnings per share and gross domestic product growth rate. Dividend yield has been found to have a negative relationship with market price per share and market capitalization. The results reveal that beta coefficients of size of banks, dividend payout ratio, leverage, gross domestic product growth and earnings per share are positive and significant for the overall market capitalization and market price per share of Nepalese commercial bank which implies that higher the size of banks, dividend payout ratio, leverage, gross domestic product growth and earnings per share result in higher market capitalization and market price per share of the Nepalese commercial banks. All the results are significant. The major conclusion of the study is the corporate payout policy of Nepalese commercial banks represented mainly by dividend yield, dividend payout ratio and earnings per share has a crucial impact on the market capitalization of Nepalese commercial banks. Other than that size, leverage and GDP have also significant impact on the market capitalization of Nepalese commercial banks. More specifically, size of the banks, dividend payout ratio, leverage, gross domestic product growth and earnings per share impacts positively and significantly to the market capitalization.

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Determinants of dividend payout of commercial banks in Nepal / Maushmi Vaidhya 

Public ISBD Title : Determinants of dividend payout of commercial banks in Nepal Material Type: printed text Authors: Maushmi Vaidhya, Author Publication Date: 2013 Pagination: 117p. Size: GRP/Thesis Accompanying material: 1/B General note: Including bibliography Languages : English Descriptors: Banks Banks and banking Capital market Commercial banks Dividend policy Dividends Maushmi Vaidhya Payouts Keywords: 'dividends  dividend policy  payouts  commercial banks  banks  Nepal  management  capital market' Class number: 332.632 Abstract: Despite of several empirical evidences, the dividend policy issues are still puzzling and unresolved. Identification of the factors shaping the dividend payouts decisions is crucial for the corporate managers and it is even more crucial in banking sector especially in case of Nepal because most of the investors in the capital market invest in the shares of the banks. So, the empirical relationship between the dividend payouts and its determinants are stated as the research questions followed by the development of the hypotheses. The major objective of this study is to analyze the factors affecting the dividend payout decisions of the commercial bank along with the examination of empirical relationship between them. The review of literatures has shown relationship between various factors such as net profit, size of the firm, ownership structure, tax structure, lag dividends, cash flows, market to book value ratio, leverage ratio, investment opportunities etc. as and the dividend payouts in case of both developed and emerging countries. In addition, net profit, cash flows, leverage ratio, ownership structure, taxes are some of the variables that are found to have significant association with dividend payouts in various context. Based on the reviews, this study has proposed the conceptual framework identifying net profit, cash flows, market to book ratio, size, debt to equity ratio, number of major shareholders and slack as the most important factors affecting the dividend payout ratio of the commercial banks in Nepal. For the purpose of study 18 listed commercial banks dividend into two strata is taken as sample and required data such as dividend payout ratios and other independent variables are collected from various secondary sources for period of 8 years i.e. 2005 to 2012. Stratified sampling method is used to select the sample commercial banks. Primary questionnaire survey is also conducted in order to assess the opinions of bank’s manager on dividend issues. Multiple regression analysis and correlation analysis are used to examine the connection between the dividend payout ratios and the determinants of the dividends. Likewise, portfolio sorted on one way sorts of seven independent variables is also employed to see if the relationship shown by regression and correlation analysis really exists. The results of secondary data analysis shows that net profit, cash flows and size of the banks have strong and significant positive impact on dividend payouts while number of major shareholders significantly affects the dividend payout ratio in negative manner. Likewise, market to book value ratio is negligible in explaining dividends; however, these variables have significant positive impact. In contrast, the study documents that leverage ratio and the slack as insignificant in explaining the variations in dividend payout ratios of commercial banks. In line with the findings of the secondary data, the primary survey reveals net profit and the cash flows as the most important determinants of the dividend payout ratios followed by the number of major shareholders and the size of the banks. The major limitations of this study lies in the fact that this study has excluded some firm specific and macro economic variables that might have influence on dividends. Despite the limitations, the findings may have significant degree of implications for both investors and the bank’s management. So, both groups of these stakeholders are recommended to take account of the determinants identified by this study and their relationship with dividend payout ratios. There is wide scope for future studies in same topic. Future studies can increases the sample size including different class of financial institutions to make the results applicable for the entire banking industry of Nepal. Determinants of dividend payout of commercial banks in Nepal [printed text] / Maushmi Vaidhya, Author . - 2013 . - 117p. ; GRP/Thesis + 1/B. Including bibliography Languages : English Descriptors: Banks Banks and banking Capital market Commercial banks Dividend policy Dividends Maushmi Vaidhya Payouts Keywords: 'dividends  dividend policy  payouts  commercial banks  banks  Nepal  management  capital market' Class number: 332.632 Abstract: Despite of several empirical evidences, the dividend policy issues are still puzzling and unresolved. Identification of the factors shaping the dividend payouts decisions is crucial for the corporate managers and it is even more crucial in banking sector especially in case of Nepal because most of the investors in the capital market invest in the shares of the banks. So, the empirical relationship between the dividend payouts and its determinants are stated as the research questions followed by the development of the hypotheses. The major objective of this study is to analyze the factors affecting the dividend payout decisions of the commercial bank along with the examination of empirical relationship between them. The review of literatures has shown relationship between various factors such as net profit, size of the firm, ownership structure, tax structure, lag dividends, cash flows, market to book value ratio, leverage ratio, investment opportunities etc. as and the dividend payouts in case of both developed and emerging countries. In addition, net profit, cash flows, leverage ratio, ownership structure, taxes are some of the variables that are found to have significant association with dividend payouts in various context. Based on the reviews, this study has proposed the conceptual framework identifying net profit, cash flows, market to book ratio, size, debt to equity ratio, number of major shareholders and slack as the most important factors affecting the dividend payout ratio of the commercial banks in Nepal. For the purpose of study 18 listed commercial banks dividend into two strata is taken as sample and required data such as dividend payout ratios and other independent variables are collected from various secondary sources for period of 8 years i.e. 2005 to 2012. Stratified sampling method is used to select the sample commercial banks. Primary questionnaire survey is also conducted in order to assess the opinions of bank’s manager on dividend issues. Multiple regression analysis and correlation analysis are used to examine the connection between the dividend payout ratios and the determinants of the dividends. Likewise, portfolio sorted on one way sorts of seven independent variables is also employed to see if the relationship shown by regression and correlation analysis really exists. The results of secondary data analysis shows that net profit, cash flows and size of the banks have strong and significant positive impact on dividend payouts while number of major shareholders significantly affects the dividend payout ratio in negative manner. Likewise, market to book value ratio is negligible in explaining dividends; however, these variables have significant positive impact. In contrast, the study documents that leverage ratio and the slack as insignificant in explaining the variations in dividend payout ratios of commercial banks. In line with the findings of the secondary data, the primary survey reveals net profit and the cash flows as the most important determinants of the dividend payout ratios followed by the number of major shareholders and the size of the banks. The major limitations of this study lies in the fact that this study has excluded some firm specific and macro economic variables that might have influence on dividends. Despite the limitations, the findings may have significant degree of implications for both investors and the bank’s management. So, both groups of these stakeholders are recommended to take account of the determinants identified by this study and their relationship with dividend payout ratios. There is wide scope for future studies in same topic. Future studies can increases the sample size including different class of financial institutions to make the results applicable for the entire banking industry of Nepal.

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Dividend policy and its impact on share price: a study on Nepalese commercial banks / Ankur Shrestha 

Public ISBD Title : Dividend policy and its impact on share price: a study on Nepalese commercial banks Material Type: printed text Authors: Ankur Shrestha, Author Publication Date: 2015 Pagination: 91p. Size: GRP/Thesis Accompanying material: 4/B General note: Including bibilography Languages : English Descriptors: Banks Banks and banking Commercial banks Dividend policy Dividends Share_Price Keywords: 'dividend policy  share price volatility  banking  dividends  share' Class number: 332.1 Abstract: Dividend policy is a major financing decision that involves with the payment to shareholders in return of their investment. Every firm operating in a given industry follows some sort of dividend payment pattern or dividend policy and obviously it is a financial indicator of the firm. Demand of the firm's share should to some extent, dependent on the firm's dividend policy. Dividend policy is one of the most widely researched topics in the field of finance but the question is whether dividend policy affects stock prices still remain debatable among managers, policy makers and researchers for many years. Dividend policy is important for investors, managers, lenders and for other stakeholders. It is important for investors because investors consider dividends not only the source of income but also a way to assess the firms from investment points of view. Selecting a suitable dividend policy is an important decision for the bank because flexibility to invest in future projects depends on the amount of dividends that they pay to their shareholders. If company pay more dividends then fewer funds are available for investment in future projects. Lenders are also interested in the amount of dividend that a company declares, as more amounts is paid as dividend means less amount would be available to the company to pay off their obligation. This study attempts to investigate the impact of dividend policy on market price of the share of the commercial banks listed in the Nepal stock exchange. This study is based on both primary and secondary sources of data. The primary data have been obtained by conducting questionnaire survey with investors. The secondary data have been collected from the supervision report of Nepal Rastra Bank, annual reports of commercial banks, different published articles, reports and books. Descriptive research design and causal comparative research design has been used to deal with issues associated with the dividend policy and share price. This study is based on pooled cross-sectional analysis of secondary data of 17 commercial banks with 102 observation for the period of 2008 to 2013. Market price of share and share price volatility are selected as the dependent variables for this study. Earnings per share, retained ratio, dividend payout ratio and dividend yield ratio are the explanatory variables. Return on equity, profit after tax, liquidity, growth of total assets, size of total assets and leverage are used as the control variables. The multiple regression models are applied to test the significance and impact of dividend policy on market price of the shares listed in the Nepal stock exchange. The primary survey revealed that Nepalese commercial banks are paying dividend as per the desire of shareholders. But most of the respondents are not satisfied with the dividend payment by commercial banks. The majority of the respondents agree that dividend paying stocks offer more certainty about the company's future earnings prospects compared to stocks that do not pay dividends. The results of the survey revealed that the majority of the respondents prefer high dividend payout. Most of the respondents blamed government's investment policy for lack of development of Nepalese stock market. The primary survey also found that major reason for the respondent's investment in shares is the expectation of increased in market price. The survey revealed that most of the respondents agree that dividend payments are better signals of confidential information than other media forms; thus raising share value and payment of dividends is a demonstration that the firm is strong enough and can pass up profitable investments. The study concluded that market price of the share is negatively related with retained ratio and liquidity. There is a positive relation of market price of the share with earnings per share, return on equity and profit after tax. The result shows that higher the earnings per share, higher would be the market price of the share. The result also indicates that lower the retained earnings, higher would be the market price of the share and lower the liquidity, higher would be the market price of the share. The share price volatility is negatively related with dividend yield ratio and size of total assets. There is a positive relation of share price volatility with dividend payout ratio, leverage and growth of total assets. The result shows that lower the dividend payout ratio, lower would be the volatility of the share price and also lower the growth of total assets, lower would be the volatility of the share price. Dividend policy and its impact on share price: a study on Nepalese commercial banks [printed text] / Ankur Shrestha, Author . - 2015 . - 91p. ; GRP/Thesis + 4/B. Including bibilography Languages : English Descriptors: Banks Banks and banking Commercial banks Dividend policy Dividends Share_Price Keywords: 'dividend policy  share price volatility  banking  dividends  share' Class number: 332.1 Abstract: Dividend policy is a major financing decision that involves with the payment to shareholders in return of their investment. Every firm operating in a given industry follows some sort of dividend payment pattern or dividend policy and obviously it is a financial indicator of the firm. Demand of the firm's share should to some extent, dependent on the firm's dividend policy. Dividend policy is one of the most widely researched topics in the field of finance but the question is whether dividend policy affects stock prices still remain debatable among managers, policy makers and researchers for many years. Dividend policy is important for investors, managers, lenders and for other stakeholders. It is important for investors because investors consider dividends not only the source of income but also a way to assess the firms from investment points of view. Selecting a suitable dividend policy is an important decision for the bank because flexibility to invest in future projects depends on the amount of dividends that they pay to their shareholders. If company pay more dividends then fewer funds are available for investment in future projects. Lenders are also interested in the amount of dividend that a company declares, as more amounts is paid as dividend means less amount would be available to the company to pay off their obligation. This study attempts to investigate the impact of dividend policy on market price of the share of the commercial banks listed in the Nepal stock exchange. This study is based on both primary and secondary sources of data. The primary data have been obtained by conducting questionnaire survey with investors. The secondary data have been collected from the supervision report of Nepal Rastra Bank, annual reports of commercial banks, different published articles, reports and books. Descriptive research design and causal comparative research design has been used to deal with issues associated with the dividend policy and share price. This study is based on pooled cross-sectional analysis of secondary data of 17 commercial banks with 102 observation for the period of 2008 to 2013. Market price of share and share price volatility are selected as the dependent variables for this study. Earnings per share, retained ratio, dividend payout ratio and dividend yield ratio are the explanatory variables. Return on equity, profit after tax, liquidity, growth of total assets, size of total assets and leverage are used as the control variables. The multiple regression models are applied to test the significance and impact of dividend policy on market price of the shares listed in the Nepal stock exchange. The primary survey revealed that Nepalese commercial banks are paying dividend as per the desire of shareholders. But most of the respondents are not satisfied with the dividend payment by commercial banks. The majority of the respondents agree that dividend paying stocks offer more certainty about the company's future earnings prospects compared to stocks that do not pay dividends. The results of the survey revealed that the majority of the respondents prefer high dividend payout. Most of the respondents blamed government's investment policy for lack of development of Nepalese stock market. The primary survey also found that major reason for the respondent's investment in shares is the expectation of increased in market price. The survey revealed that most of the respondents agree that dividend payments are better signals of confidential information than other media forms; thus raising share value and payment of dividends is a demonstration that the firm is strong enough and can pass up profitable investments. The study concluded that market price of the share is negatively related with retained ratio and liquidity. There is a positive relation of market price of the share with earnings per share, return on equity and profit after tax. The result shows that higher the earnings per share, higher would be the market price of the share. The result also indicates that lower the retained earnings, higher would be the market price of the share and lower the liquidity, higher would be the market price of the share. The share price volatility is negatively related with dividend yield ratio and size of total assets. There is a positive relation of share price volatility with dividend payout ratio, leverage and growth of total assets. The result shows that lower the dividend payout ratio, lower would be the volatility of the share price and also lower the growth of total assets, lower would be the volatility of the share price.

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Dividend policy and share price volatility: evidence from Nepalese commercial banks / Rakhi Jha 

Public ISBD Title : Dividend policy and share price volatility: evidence from Nepalese commercial banks Material Type: printed text Authors: Rakhi Jha, Author Publication Date: 2014 Pagination: 80p. Size: GRP/Thesis Accompanying material: 2/B General note: Including Bibliography Languages : English Descriptors: Banks and banking Dividend policy Dividends Share-Price Keywords: 'dividend policy  share price volatility  banking  dividends  share' Class number: 650 Abstract: The study on dividend policy and share price volatility: evidence from Nepalese commercial banks provides an important insight into the understanding of share price behavior in Nepal stock market. This study basically aimed at examining the volatility in share price with respect to banks specific variables and also attempted to evaluate the causal relationship between dividend policy and share price volatility in Nepalese stock market. The main purpose of this study is to know relationship between share price volatility and dividend yield, dividend payout, capital, earnings, asset quality, net interest margin, investment, size, debt, return on equity and return on assets. However, the specific objectives of the study are: (a) to analyze whether the current dividend policy should be maintained or changed, (b) to examine the investor‟s preference towards dividend payment, (c) to analyze the uniformity with regards to behaviors in dividend distribution of Nepalese Commercial banks, (d) to analyze the relationship between dividend and market price of share, (e) to identify the relationship between price volatility and financial performance of Nepalese commercial banks, (f) to examine the effects of bank specific variables on price volatility. The proposed study could be used by researchers, policy makers, and mangers to examine and understand share price volatility and dividend policy in Nepalese context. The sample was selected through purposive sampling method. A structured, self administered questionnaire was used to collect data from the respondents. Descriptive statistics including frequencies, percentages, mean and standard deviation were used to describe variable characteristics while inferential statistics (correlation and regression) were used to determine and explain variable relationships. The multiple regression models are used to check the relationship between dependent and independent variables. This study employs panel data techniques to measure the relation between price volatility with dividend yield, dividend payout, capital, size, net interest margin, investment, debt, return on assets, return on equity and earnings volatility for a sample of 20 commercial banks for the period of 2007-2011. For this we are selecting 20 commercial banks of Nepal containing 100 observations. VIII The study results showed that price volatility is positively correlated with dividend payout, size of the firm, investment, return on assets and return on equity whereas, negatively correlated with dividend yield, capital, net interest margin, and debt and earnings volatility. The coefficient of dividend yield and size is positive with price volatility. The coefficient of dividend payout, capital, net interest margin, investment, debt, return on assets, and return on equity and earnings volatility is negative with price volatility. Further this study found that stable dividend policies should be followed by the commercial banks. If the company has no cash to pay dividends then company should pay stock dividends. Hence, current trading price of shares in the market is moderate. Lack of buying and selling behavior of investors is responsible for the lack of development of Nepalese stock market. On the basis of earnings dividend declaring firms have more shareholders and their share value is high. On the basis of financial performance firm should not pay dividends if profitable investments. Stable dividend at present level is recommended for Nepalese commercial banks. Share prices are more volatile (volatile: ups and downs) than expected dividends. In sum up, the major findings of this study can add value to the existing literature. It may help decision makers at bank to focus on major banking activities that may increase the stock price or may decrease the stock price volatility with other competitive banks. This may also help management of commercial bank in creating appropriate strategies for attaining the least share price volatility in Nepalese stock market. Dividend policy and share price volatility: evidence from Nepalese commercial banks [printed text] / Rakhi Jha, Author . - 2014 . - 80p. ; GRP/Thesis + 2/B. Including Bibliography Languages : English Descriptors: Banks and banking Dividend policy Dividends Share-Price Keywords: 'dividend policy  share price volatility  banking  dividends  share' Class number: 650 Abstract: The study on dividend policy and share price volatility: evidence from Nepalese commercial banks provides an important insight into the understanding of share price behavior in Nepal stock market. This study basically aimed at examining the volatility in share price with respect to banks specific variables and also attempted to evaluate the causal relationship between dividend policy and share price volatility in Nepalese stock market. The main purpose of this study is to know relationship between share price volatility and dividend yield, dividend payout, capital, earnings, asset quality, net interest margin, investment, size, debt, return on equity and return on assets. However, the specific objectives of the study are: (a) to analyze whether the current dividend policy should be maintained or changed, (b) to examine the investor‟s preference towards dividend payment, (c) to analyze the uniformity with regards to behaviors in dividend distribution of Nepalese Commercial banks, (d) to analyze the relationship between dividend and market price of share, (e) to identify the relationship between price volatility and financial performance of Nepalese commercial banks, (f) to examine the effects of bank specific variables on price volatility. The proposed study could be used by researchers, policy makers, and mangers to examine and understand share price volatility and dividend policy in Nepalese context. The sample was selected through purposive sampling method. A structured, self administered questionnaire was used to collect data from the respondents. Descriptive statistics including frequencies, percentages, mean and standard deviation were used to describe variable characteristics while inferential statistics (correlation and regression) were used to determine and explain variable relationships. The multiple regression models are used to check the relationship between dependent and independent variables. This study employs panel data techniques to measure the relation between price volatility with dividend yield, dividend payout, capital, size, net interest margin, investment, debt, return on assets, return on equity and earnings volatility for a sample of 20 commercial banks for the period of 2007-2011. For this we are selecting 20 commercial banks of Nepal containing 100 observations. VIII The study results showed that price volatility is positively correlated with dividend payout, size of the firm, investment, return on assets and return on equity whereas, negatively correlated with dividend yield, capital, net interest margin, and debt and earnings volatility. The coefficient of dividend yield and size is positive with price volatility. The coefficient of dividend payout, capital, net interest margin, investment, debt, return on assets, and return on equity and earnings volatility is negative with price volatility. Further this study found that stable dividend policies should be followed by the commercial banks. If the company has no cash to pay dividends then company should pay stock dividends. Hence, current trading price of shares in the market is moderate. Lack of buying and selling behavior of investors is responsible for the lack of development of Nepalese stock market. On the basis of earnings dividend declaring firms have more shareholders and their share value is high. On the basis of financial performance firm should not pay dividends if profitable investments. Stable dividend at present level is recommended for Nepalese commercial banks. Share prices are more volatile (volatile: ups and downs) than expected dividends. In sum up, the major findings of this study can add value to the existing literature. It may help decision makers at bank to focus on major banking activities that may increase the stock price or may decrease the stock price volatility with other competitive banks. This may also help management of commercial bank in creating appropriate strategies for attaining the least share price volatility in Nepalese stock market.

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Effect of leverage, dividend policy and profitability on value of Nepalese commecial banks / Shraddha Shrestha 

Public ISBD Title : Effect of leverage, dividend policy and profitability on value of Nepalese commecial banks Material Type: printed text Authors: Shraddha Shrestha, Author Publication Date: 2016 Pagination: 80p. Size: GRP/Thesis Accompanying material: 5/B General note: Including Bibilography Languages : English Descriptors: Banks Banks and banking Dividend policy Dividends Keywords: 'dividend policy  banking  dividends  return on assets  return on equity' Class number: 332.1 Abstract: Leverage, dividend policy and profitability is very important for both bank and country. It ensures the value of commercial bank. If bank fails to balance it in a proper way, it will significantly affect the bank and indirectly affect the country as well. The main purpose of this research is to analyze the effect of leverage, dividend policy and profitability on value of Nepalese commercial banks. This research had tried to investigate the internal (bank specific) that will affect decisions of dividend policy and value of firms. A total of 14 commercial banks are chosen to represent the Nepalese commercial banks during period form 2002/03 to 2013/14. The independent variables for this research are earnings per share, price earnings ratio, book value per share, return on assets, debt to equity, size and tax.For analysis of data descriptive statistics, correlation, and regression analysis among the dependent and independent is used.This study is based on secondary data and data are collected from the annual reports of the individual bank, Nepal Rastra Bank BFIs statistics, and audited balance sheet of respective bank, published journals and books. The correlation analysis shows that the dependent variable, market price of share is positively related to earnings per share, dividend per share, price earnings ratio, book value per share, return on assets and size, debt equity ratio, reserve and tax payable. However, the result shows that there is only significant positive relationship of earning per share and dividend per share, return on assets, size, reserve and tax with market price per share. The linear regression model is used to examine the relationship between dependent variable, dividend per share, market price per share and independent variables, firm specific. Among the firm specific variables, return on assets, size, earning per share, book value per share and debt to equity with dividend per share,size, earning per share and reserve shows the significant positive relationship with dividend per share. The regression of firm specific variables on market price per share shows that the beta coefficients are positive and significant for earning per share, return on assets, dividend per share, size and tax. Likewise, the beta coefficient of P/E ratio is also found to be positive and but not significant. The study shows that dividend per share is positively related with market per share and relationship is significant, which also supports the priori hypothesis of positive relationship with value of firms. The positive relationship with market value of firms indicates that increase in dividend per share leads to increase in market price per share. Return on assets, size and tax has also has significant relationship with market price per share. The positive coefficient of return on assets, size and tax to market price per share indicates increasing return on assets, size and tax contributes to increase in value of commercial banks which also support the prior hypothesis. Effect of leverage, dividend policy and profitability on value of Nepalese commecial banks [printed text] / Shraddha Shrestha, Author . - 2016 . - 80p. ; GRP/Thesis + 5/B. Including Bibilography Languages : English Descriptors: Banks Banks and banking Dividend policy Dividends Keywords: 'dividend policy  banking  dividends  return on assets  return on equity' Class number: 332.1 Abstract: Leverage, dividend policy and profitability is very important for both bank and country. It ensures the value of commercial bank. If bank fails to balance it in a proper way, it will significantly affect the bank and indirectly affect the country as well. The main purpose of this research is to analyze the effect of leverage, dividend policy and profitability on value of Nepalese commercial banks. This research had tried to investigate the internal (bank specific) that will affect decisions of dividend policy and value of firms. A total of 14 commercial banks are chosen to represent the Nepalese commercial banks during period form 2002/03 to 2013/14. The independent variables for this research are earnings per share, price earnings ratio, book value per share, return on assets, debt to equity, size and tax.For analysis of data descriptive statistics, correlation, and regression analysis among the dependent and independent is used.This study is based on secondary data and data are collected from the annual reports of the individual bank, Nepal Rastra Bank BFIs statistics, and audited balance sheet of respective bank, published journals and books. The correlation analysis shows that the dependent variable, market price of share is positively related to earnings per share, dividend per share, price earnings ratio, book value per share, return on assets and size, debt equity ratio, reserve and tax payable. However, the result shows that there is only significant positive relationship of earning per share and dividend per share, return on assets, size, reserve and tax with market price per share. The linear regression model is used to examine the relationship between dependent variable, dividend per share, market price per share and independent variables, firm specific. Among the firm specific variables, return on assets, size, earning per share, book value per share and debt to equity with dividend per share,size, earning per share and reserve shows the significant positive relationship with dividend per share. The regression of firm specific variables on market price per share shows that the beta coefficients are positive and significant for earning per share, return on assets, dividend per share, size and tax. Likewise, the beta coefficient of P/E ratio is also found to be positive and but not significant. The study shows that dividend per share is positively related with market per share and relationship is significant, which also supports the priori hypothesis of positive relationship with value of firms. The positive relationship with market value of firms indicates that increase in dividend per share leads to increase in market price per share. Return on assets, size and tax has also has significant relationship with market price per share. The positive coefficient of return on assets, size and tax to market price per share indicates increasing return on assets, size and tax contributes to increase in value of commercial banks which also support the prior hypothesis.

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Barcode	Call number	Media type	Location	Section	Status
213/D	332.1 SHR	Thesis/Dissertation	Uniglobe Library	Social Sciences	Available

Factors affecting dividend payout in Nepalese commercial banks / Shilpa Shrestha 

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The effect of taxation of dividend Policy: a case of Nepalese commercial banks / Subash Neupane 

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