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Customer satisfaction and brand loyalty of mobile phones in Kathmandu Valley / Kamala Shah
Title : Customer satisfaction and brand loyalty of mobile phones in Kathmandu Valley Material Type: printed text Authors: Kamala Shah, Author Publication Date: 2017 Pagination: 99p. Size: GRP/Thesis Accompanying material: 10/B Languages : English Descriptors: Customer satisfaction
Banks
Banks and bankingClass number: 658.812 Abstract: Customer satisfaction is a fundamental goal of marketing. According to Bloemer and Schronder (2002), customer satisfaction is the result of successful marketing that creates competitive value for the customers. Contemporary marketing efforts are geared towards meeting consumers’ needs and ensuring customer satisfaction and strategizing on how to retain such customer (Hassan, 2008). Customer satisfaction is one of the measures for finding the performance of the product and organization relating to its competitive market environment (Hill and Alexander, 2006). Satisfied consumers probably talk to other people about their favorite business and the result of such dialogues is a sort of positive promotion for the company, organization or agency by word of mouth, or vice versa (Kurdnaidj, 2003). Since the launch of mobile phones, there has been a remarkable development both in their product sophistication and their fast and global adoption (Bayraktar et al., 2012). After the smart phones have been released, the choice seemed to be even harder, since the opportunities and offers that producers are providing are endless (Seongwon et al., 2011; Milutinovic et al., 2011). In the competitive market of mobile phone, the manufacturers always keep to competitive edge and differentiate the product attributes to persuade the customer to choose their brand instead of other. Brand loyalty can be described as, a deeply held commitment to re-buy or re-patronize a preferred product/service consistently in the future, causing a repetitive same brand or same brand-set purchasing, despite situational influences and marketing efforts having the potential to cause switching behavior (Son et al., 2010). Brand loyalty is the source of commitment towards the brand that includes a re-buy behavior into the customer in spite of the potential marketing attempts by competitors to break up the coalition between the brand and the customer (Oliver, 1999). Dick and Basu (1994) argued that there may be positive as well as negative perception of the consumers towards the brand and the negative perception may lead to patronize of the brand.
The major purpose of this study is to examine factors affecting customer satisfaction and brand loyalty of mobiles phones in context of Kathmandu valley. The study has the following specific objectives: to analyze the perception of customers on the level of brand specific factors (brand image, perceived brand quality, brand experienced, brand switching costs and price fairness) of mobile phones brands in Kathmandu valley, to determine the relationship of selected mobile phone brand specific factors on with customer satisfaction and brand loyalty, to examine the impact of selected mobile phone brand specific factors on customer satisfaction and brand loyalty. to find out the most important mobile phone brand specific factor affecting customer satisfaction and brand loyalty.
The primary source of data is used to assess the opinion of customer satisfaction and brand loyalty of mobile phones in Kathmandu valley The survey is based on 200 observations. The questions were asked in the form of Yes/No, and likert scale questions. The likert scale questions of different variables on customer satisfactions and brand loyalty were measured in 5 point scale. The proxies of customer satisfactions and brand loyalty are brand iamge, perceived brand quality, brand switching cost, price fairness and brand experiences. The weighted mean of the each variables were used to examined the factors affecting customer satisfaction and brand loyalty of mobiles phones in context of Kathmandu valley. For the fact finding of the study primary data was analyzed by using percentage frequency distribution and methods such as descriptive analysis, correlation analysis and regression analysis.
The result of this study reveals that there is positive correlation between brand image with customer satisfaction and brand loyalty. This indicates that better brand image leads to increase in customer satisfaction and brand loyalty. Similarly, perceived brand quality, brand switching cost, price fairness and brand experiences are positively correlated to customer satisfaction and brand loyalty. This reveals that better perceived brand quality, brand switching cost, price fairness and brand experiences enhances customer satisfaction and brand loyalty. The beta coefficients is positive for brand image, perceived brand quality, brand switching cost, price fairness and brand experience with customer satisfaction which indicates that increase in all these independent variables, would increase in customer satisfaction. The beta coefficients are positive for brand image, perceived brand quality, brand switching cost, price fairness and brand experience with brand loyalty which indicates that increase in all these independent variables, would increase in loyalty.
The major conclusion of the study is that brand experience followed by perceived brand quality, brand image, price fairness, and brand switching cost are the most dominant factors that influence the customer satisfaction of the mobile phones in Kathmandu valley. Similarly, the brand experience followed by brand image, brand switching cost, price fairness and perceived brand quality are the most dominant factors that influence the brand loyalty of the mobile phones in Kathmandu valley.
Customer satisfaction and brand loyalty of mobile phones in Kathmandu Valley [printed text] / Kamala Shah, Author . - 2017 . - 99p. ; GRP/Thesis + 10/B.
Languages : English
Descriptors: Customer satisfaction
Banks
Banks and bankingClass number: 658.812 Abstract: Customer satisfaction is a fundamental goal of marketing. According to Bloemer and Schronder (2002), customer satisfaction is the result of successful marketing that creates competitive value for the customers. Contemporary marketing efforts are geared towards meeting consumers’ needs and ensuring customer satisfaction and strategizing on how to retain such customer (Hassan, 2008). Customer satisfaction is one of the measures for finding the performance of the product and organization relating to its competitive market environment (Hill and Alexander, 2006). Satisfied consumers probably talk to other people about their favorite business and the result of such dialogues is a sort of positive promotion for the company, organization or agency by word of mouth, or vice versa (Kurdnaidj, 2003). Since the launch of mobile phones, there has been a remarkable development both in their product sophistication and their fast and global adoption (Bayraktar et al., 2012). After the smart phones have been released, the choice seemed to be even harder, since the opportunities and offers that producers are providing are endless (Seongwon et al., 2011; Milutinovic et al., 2011). In the competitive market of mobile phone, the manufacturers always keep to competitive edge and differentiate the product attributes to persuade the customer to choose their brand instead of other. Brand loyalty can be described as, a deeply held commitment to re-buy or re-patronize a preferred product/service consistently in the future, causing a repetitive same brand or same brand-set purchasing, despite situational influences and marketing efforts having the potential to cause switching behavior (Son et al., 2010). Brand loyalty is the source of commitment towards the brand that includes a re-buy behavior into the customer in spite of the potential marketing attempts by competitors to break up the coalition between the brand and the customer (Oliver, 1999). Dick and Basu (1994) argued that there may be positive as well as negative perception of the consumers towards the brand and the negative perception may lead to patronize of the brand.
The major purpose of this study is to examine factors affecting customer satisfaction and brand loyalty of mobiles phones in context of Kathmandu valley. The study has the following specific objectives: to analyze the perception of customers on the level of brand specific factors (brand image, perceived brand quality, brand experienced, brand switching costs and price fairness) of mobile phones brands in Kathmandu valley, to determine the relationship of selected mobile phone brand specific factors on with customer satisfaction and brand loyalty, to examine the impact of selected mobile phone brand specific factors on customer satisfaction and brand loyalty. to find out the most important mobile phone brand specific factor affecting customer satisfaction and brand loyalty.
The primary source of data is used to assess the opinion of customer satisfaction and brand loyalty of mobile phones in Kathmandu valley The survey is based on 200 observations. The questions were asked in the form of Yes/No, and likert scale questions. The likert scale questions of different variables on customer satisfactions and brand loyalty were measured in 5 point scale. The proxies of customer satisfactions and brand loyalty are brand iamge, perceived brand quality, brand switching cost, price fairness and brand experiences. The weighted mean of the each variables were used to examined the factors affecting customer satisfaction and brand loyalty of mobiles phones in context of Kathmandu valley. For the fact finding of the study primary data was analyzed by using percentage frequency distribution and methods such as descriptive analysis, correlation analysis and regression analysis.
The result of this study reveals that there is positive correlation between brand image with customer satisfaction and brand loyalty. This indicates that better brand image leads to increase in customer satisfaction and brand loyalty. Similarly, perceived brand quality, brand switching cost, price fairness and brand experiences are positively correlated to customer satisfaction and brand loyalty. This reveals that better perceived brand quality, brand switching cost, price fairness and brand experiences enhances customer satisfaction and brand loyalty. The beta coefficients is positive for brand image, perceived brand quality, brand switching cost, price fairness and brand experience with customer satisfaction which indicates that increase in all these independent variables, would increase in customer satisfaction. The beta coefficients are positive for brand image, perceived brand quality, brand switching cost, price fairness and brand experience with brand loyalty which indicates that increase in all these independent variables, would increase in loyalty.
The major conclusion of the study is that brand experience followed by perceived brand quality, brand image, price fairness, and brand switching cost are the most dominant factors that influence the customer satisfaction of the mobile phones in Kathmandu valley. Similarly, the brand experience followed by brand image, brand switching cost, price fairness and perceived brand quality are the most dominant factors that influence the brand loyalty of the mobile phones in Kathmandu valley.
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Barcode Call number Media type Location Section Status 374/D 658.812 SHA Thesis/Dissertation Uniglobe Library Technology Available Customer services and ATM services: comparative study of joint venture and non-joint venture banks in Nepal / Minakshi Pathak
Title : Customer services and ATM services: comparative study of joint venture and non-joint venture banks in Nepal Material Type: printed text Authors: Minakshi Pathak, Author Publication Date: 2015 Pagination: 85p. Size: GRP/Thesis Accompanying material: 5/B General note: including bibilography Languages : English Descriptors: Customer satisfaction
ATM services
Banks
Banks and banking
SecurityKeywords: 'responsiveness case of use convenience security customer satisfaction banks' Class number: 658.812 Abstract: Customer satisfaction is also defined as "the number of customers, or percentage of total customers, whose reported experience with a firm, its products or its services (ratings) exceeds specified satisfaction goals. Automated Teller Machine (ATM) refers to a machine that acts as a bank teller by receiving and issuing money to and from the ATM account holders/users. The evolution of ATM was not in isolation, rather as a result of the general global wave in the technological revolution. This came due to the need to respond to the challenge of the multiple bulk of daily complex information that arises from among others; increase in competition, increased customer demand for both service provision as well as efficiency, expansion due to the increased in demand for services. Use of ATM has become extremely popular among customers as convenient mode of transactions. The advantages of using ATM have given new impetus in dimension of service quality and banks offering new choices to customers. Some studies have shown the positive dimension of ATMs based on freedom of transaction and other studies have shown that dissatisfaction among customers is associated with frequent Interruption and breakdown of ATM.The main objective of this study is to examine the consumer satisfaction on ATM services of Joint Venture and Non-Joint Venture banks. The survey is based on 200 respondents from 30 commercial banks in Nepal. The multiple regression models are estimated to test the significance and importance of Customer satisfaction about ATM services in Nepalese commercial banks.
The study revealed that most of the ATM users of non-joint venture banks and joint venture banks agreed that they are satisfied with the service quality of ATM provided by bank. The study revealed that technical failures are the most faced problems by ATM users of joint venture banks and non-joint venture banks. The result revealed that the highest correlation is ease of use and security. The result indicates that responsiveness is positively correlated to the customer satisfaction. Prompt service to the customers leads the customer satisfaction. The study shows that responsiveness, ease of use, convenience and security have significant and positive relation with customer satisfaction. The positive relation indicates that the higher the responsiveness, ease of use, convenience and security, higher would be the customer satisfaction.Customer services and ATM services: comparative study of joint venture and non-joint venture banks in Nepal [printed text] / Minakshi Pathak, Author . - 2015 . - 85p. ; GRP/Thesis + 5/B.
including bibilography
Languages : English
Descriptors: Customer satisfaction
ATM services
Banks
Banks and banking
SecurityKeywords: 'responsiveness case of use convenience security customer satisfaction banks' Class number: 658.812 Abstract: Customer satisfaction is also defined as "the number of customers, or percentage of total customers, whose reported experience with a firm, its products or its services (ratings) exceeds specified satisfaction goals. Automated Teller Machine (ATM) refers to a machine that acts as a bank teller by receiving and issuing money to and from the ATM account holders/users. The evolution of ATM was not in isolation, rather as a result of the general global wave in the technological revolution. This came due to the need to respond to the challenge of the multiple bulk of daily complex information that arises from among others; increase in competition, increased customer demand for both service provision as well as efficiency, expansion due to the increased in demand for services. Use of ATM has become extremely popular among customers as convenient mode of transactions. The advantages of using ATM have given new impetus in dimension of service quality and banks offering new choices to customers. Some studies have shown the positive dimension of ATMs based on freedom of transaction and other studies have shown that dissatisfaction among customers is associated with frequent Interruption and breakdown of ATM.The main objective of this study is to examine the consumer satisfaction on ATM services of Joint Venture and Non-Joint Venture banks. The survey is based on 200 respondents from 30 commercial banks in Nepal. The multiple regression models are estimated to test the significance and importance of Customer satisfaction about ATM services in Nepalese commercial banks.
The study revealed that most of the ATM users of non-joint venture banks and joint venture banks agreed that they are satisfied with the service quality of ATM provided by bank. The study revealed that technical failures are the most faced problems by ATM users of joint venture banks and non-joint venture banks. The result revealed that the highest correlation is ease of use and security. The result indicates that responsiveness is positively correlated to the customer satisfaction. Prompt service to the customers leads the customer satisfaction. The study shows that responsiveness, ease of use, convenience and security have significant and positive relation with customer satisfaction. The positive relation indicates that the higher the responsiveness, ease of use, convenience and security, higher would be the customer satisfaction.Hold
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Barcode Call number Media type Location Section Status 97/D 658.812 PAT Thesis/Dissertation Uniglobe Library Technology Available Customer switching behavior in the retail banking industry of Nepal / Shazia Thapa
Title : Customer switching behavior in the retail banking industry of Nepal Material Type: printed text Authors: Shazia Thapa, Author Publication Date: 2014 Pagination: 72p. Size: GRP/Thesis Accompanying material: 3/B General note: Including bibilography Languages : English Descriptors: Banks
Banks and banking
Consumer behavior
Customer relations
Nepal
Relationship marketing
SupermarketsKeywords: 'consumer behavior cusomer relations banks banks and banking relationship marketing nepal' Class number: 658.834 Customer switching behavior in the retail banking industry of Nepal [printed text] / Shazia Thapa, Author . - 2014 . - 72p. ; GRP/Thesis + 3/B.
Including bibilography
Languages : EnglishHold
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Barcode Call number Media type Location Section Status 71/D 658.834 THA Thesis/Dissertation Uniglobe Library Technology Available Depositors knowledge and perception about deposit insurance in Nepalese commercial banks / Bikash Gajurel
Title : Depositors knowledge and perception about deposit insurance in Nepalese commercial banks Material Type: printed text Authors: Bikash Gajurel, Author Publication Date: 2014 Pagination: 73p. Size: GRP/Thesis Accompanying material: 2/B General note: Including bibilography Languages : English Descriptors: Banks
Banks and banking
Commercial banks
Deposit insurance
NepalKeywords: 'deposit insurance depositors knowledge commercial banks banks banks and banking Nepal' Class number: 353.008 Abstract: Deposit insurance has been spreading rapidly in recent years, even to countries with low levels of financial and institutional development. The main benefit from introducing a deposit insurance scheme is to protect small and presumably uninformed depositors against bank failure. Depositors’ awareness is particularly important for newly established deposit insurance schemes. Yet, deposit insurance is unlikely to work if the depositor does not know about it or if the information or perceptions the depositor has are incorrect.
Taking Nepalese bank depositors as a sample, report investigate the knowledge about existing deposit insurance systems and the perception of deposit insurance system. Major objective of the study is to assess depositors’ knowledge and perception about deposit insurance in Nepalese banking sector. To examine the perception of depositors regarding trust ,to analyze relationship between education level and knowledge of deposit insurance and to find out whether deposit insurance boost up the confidence of depositors in commercial banks are other specific objectives.
This study has employed descriptive research designs to deal with issues associated with the deposit insurance and knowledge and perception of deposit insurance. A primary questionnaire survey of 200 depositors of different commercial banks has been conducted to collect the opinions on deposit insurance in Nepal. This research design was used to ascertain and understand the directions, magnitudes and forms of observed relationship between deposit insurance knowledge and perception of depositors. Hence, the research design was qualitative research design.
Findings show that depositors of Nepalese banks are aware of deposit insurance system and they perceive deposit insurance as a mechanism that creates safety of public deposits. Similarly there exists a significant relationship between depositors’ knowledge and knowledge dimensions and depositors perceive their deposits are safe in commercial banks after the provision of deposit insurance.
It is recommended that there are still more depositors who do not have an idea about the deposit insurance, NRB and concerned parties should raise public awareness through the available media, about the purpose, characteristics, benefits, limitations and any other information which consider relevant of the deposit insurance system.
Depositors knowledge and perception about deposit insurance in Nepalese commercial banks [printed text] / Bikash Gajurel, Author . - 2014 . - 73p. ; GRP/Thesis + 2/B.
Including bibilography
Languages : English
Descriptors: Banks
Banks and banking
Commercial banks
Deposit insurance
NepalKeywords: 'deposit insurance depositors knowledge commercial banks banks banks and banking Nepal' Class number: 353.008 Abstract: Deposit insurance has been spreading rapidly in recent years, even to countries with low levels of financial and institutional development. The main benefit from introducing a deposit insurance scheme is to protect small and presumably uninformed depositors against bank failure. Depositors’ awareness is particularly important for newly established deposit insurance schemes. Yet, deposit insurance is unlikely to work if the depositor does not know about it or if the information or perceptions the depositor has are incorrect.
Taking Nepalese bank depositors as a sample, report investigate the knowledge about existing deposit insurance systems and the perception of deposit insurance system. Major objective of the study is to assess depositors’ knowledge and perception about deposit insurance in Nepalese banking sector. To examine the perception of depositors regarding trust ,to analyze relationship between education level and knowledge of deposit insurance and to find out whether deposit insurance boost up the confidence of depositors in commercial banks are other specific objectives.
This study has employed descriptive research designs to deal with issues associated with the deposit insurance and knowledge and perception of deposit insurance. A primary questionnaire survey of 200 depositors of different commercial banks has been conducted to collect the opinions on deposit insurance in Nepal. This research design was used to ascertain and understand the directions, magnitudes and forms of observed relationship between deposit insurance knowledge and perception of depositors. Hence, the research design was qualitative research design.
Findings show that depositors of Nepalese banks are aware of deposit insurance system and they perceive deposit insurance as a mechanism that creates safety of public deposits. Similarly there exists a significant relationship between depositors’ knowledge and knowledge dimensions and depositors perceive their deposits are safe in commercial banks after the provision of deposit insurance.
It is recommended that there are still more depositors who do not have an idea about the deposit insurance, NRB and concerned parties should raise public awareness through the available media, about the purpose, characteristics, benefits, limitations and any other information which consider relevant of the deposit insurance system.
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Barcode Call number Media type Location Section Status 55/D 353.008 GAJ Thesis/Dissertation Uniglobe Library Social Sciences Available Determinants of assets quality and banks profitability : a comparative study of public banks, joint venture banks and private banks / Ravi Sapkota
Title : Determinants of assets quality and banks profitability : a comparative study of public banks, joint venture banks and private banks Material Type: printed text Authors: Ravi Sapkota, Author Publication Date: 2016 Pagination: 104p. Size: GRP/Thesis Accompanying material: 8/B Languages : English Descriptors: 6 Politics, law and economics:6.70 Finance and trade:Finance:Financial administration:Accounting:Financial statements:Profits
Banks and banking
Portfolio managementClass number: 330.954 Abstract: One of the most effective ways of improving the economic indicators is by decreasing the NPLs. If NPLs are retained permanently, it will affect the resources that are enclosed in the areas which are not profitable. NPL can cause huge effect to the economy and its capability to run in an efficient manner (Hou, 2007). Financial system can experience shock from company specific variables or from variables that are external to the organization i.e. macroeconomic variables. Zimmerman (1996) found that management decisions, especially regarding loan portfolio concentration are the major factors affecting bank performance.
Wall (1985) concluded that a bank’s asset and liability management, its funding management, and the non-interest cost controls all have a significant effect on the profitability record.Hou (2007) found that many financial institutions have become insolvent due to large portion of non-performing loans. Many studies have attributed the failures of banks and insolvency to the assets quality (Demirguc- Kunt, 1989 and Barr and Siems, 1994). The large size of bad loans in the banking system generally causes bank failure. An economy that is stagnant is mainly responsible for non-performing loan which is an indication of degradation of assets quality.
There are differences in public sector banks, joint venture banks and domestic private banks in terms of profitability, capital adequacy, asset quality, riskiness, size, liquidity and management effectiveness.One of the most effective ways of improving the economic indicators is by decreasing the NPLs. Boudrigaet al. (2009) found positive relationship between capital adequacy ratio and non-performing loan. , Jimenez andSaurina (2006) attributed the excessive increase in loan ratio as the main reason for high non-performing loans.Qin & Pastory(2012) revealed that liquidity and asset quality have positive impact in profitability.Demirguc-Kunt and Huizinga (1999) found that there is positive association between economic growth and financial sector profitability. According to Haggler (1977), inflation severely affects the banks’ profitability.
The major objective of the study is to identity the determinants of assets quality and profitability of the Nepalese commercial banks. The study is based on secondary data of 17 commercial banks with 187 observations for the period of 2004/05 to 2014/15. The main source of data include various issues of Banking and Financial Statistics, Quarterly Economic Bulletin, Bank Supervision Report published by Nepal Rastra Bank and Annual Reports of selected commercial banks. . Similarly, macro-economic variables are collected from World Development Indicators maintained by World Bank.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 identifying the determinants of assets quality and profitability of Nepalese commercial banks.
The results shows that NBBL has the highest average NPA,, and NBL has the highest average EPS among the selected commercial banks throughout the study period. Similarly, the average operating expense ratio is highest for ADBL (8.64 percent), average credit to deposit ratio is highest for LUBL (107.98 percent), average capital adequacy ratio is highest for SCBL (15.73 percent), and average total asset is highest for ADBL (Rs. 69.42 billion).
The descriptive statistics for joint venture bank shows that the average non-performing assets, earnings per share, operating expense ratio, credit to deposit ratio, capital adequacy ratio, firm size, gross domestic product, and inflation is 4.13 percent, Rs. 66.03 per share, 4.01 percent, 67.45 percent, 11.22 percent, Rs. 46.18 billion, 4.25 percent, and 8.53 percent respectively. Similarly, the descriptive statistics for the public bank reveals that the average non-performing assets, earnings per share, operating expense ratio, credit to deposit ratio, capital adequacy ratio, firm size, gross domestic product, and inflation is 11.45 percent, 94.28 percent, 7.56 percent, 79.19 percent, 0.38 percent, Rs. 66.03 billion, 4.25 percent, and 8.53 percent respectively. The results for the private banks reveals that the average non-performing assets, earnings per share, operating expense ratio, credit to deposit ratio, capital adequacy ratio, firm size, gross domestic product, and inflation is 2.54 percent, Rs. 22.43 per share, 2.53 percent, 82.63 percent, 11.48 percent, Rs. 27.79 billion, 4.25 percent, and 8.53 percent respectively.
In case of joint venture banks, capital adequacy ratio, firm size, and gross domestic product are negatively related to non-performing assets. Results also show thatcapital adequacy ratio, firm size, and gross domestic product are positively related to earnings per share. On the other hand, the study of the public banks reveals that credit to deposit ratio, capital adequacy ratio, gross domestic product, and inflation are negatively related to non-performing assets and earnings per share whereas firm size is positively related to earnings per share. Likewise, the study of private banks reveals that the operating expense ratio is negatively related to non-performing assets and earnings per share. However, results show that inflation is positively related to non-performing assets for private banks.
The regression results show that capital adequacy ratio and firm size have negative and significant impact on the non-performing assets of all categories of Nepalese commercial banks. Likewise, inflation has significant negative impact on the non-performing assets of public banks, where beta coefficients are significant at 5 percent level of significance. However, the beta coefficients are positive for inflation in the case of joint venture and private banks. Likewise, results show that credit to deposit ratio and capital adequacy ratio have positive impact on earnings per share in the context of joint venture and private banks. However, the beta coefficients are negative for public banks. On the other hand, firm size has positive impact on the earnings per share of joint venture, public, and private banks. However, non-performing loans has negative impact on the earnings per share of all categories of Nepalese commercial banks. Thus, capital adequacy ratio and firm size are the major factors determining the assets quality whereas non-performing loans is the major factor influencing the profitability of Nepalese commercial banks.
Determinants of assets quality and banks profitability : a comparative study of public banks, joint venture banks and private banks [printed text] / Ravi Sapkota, Author . - 2016 . - 104p. ; GRP/Thesis + 8/B.
Languages : English
Descriptors: 6 Politics, law and economics:6.70 Finance and trade:Finance:Financial administration:Accounting:Financial statements:Profits
Banks and banking
Portfolio managementClass number: 330.954 Abstract: One of the most effective ways of improving the economic indicators is by decreasing the NPLs. If NPLs are retained permanently, it will affect the resources that are enclosed in the areas which are not profitable. NPL can cause huge effect to the economy and its capability to run in an efficient manner (Hou, 2007). Financial system can experience shock from company specific variables or from variables that are external to the organization i.e. macroeconomic variables. Zimmerman (1996) found that management decisions, especially regarding loan portfolio concentration are the major factors affecting bank performance.
Wall (1985) concluded that a bank’s asset and liability management, its funding management, and the non-interest cost controls all have a significant effect on the profitability record.Hou (2007) found that many financial institutions have become insolvent due to large portion of non-performing loans. Many studies have attributed the failures of banks and insolvency to the assets quality (Demirguc- Kunt, 1989 and Barr and Siems, 1994). The large size of bad loans in the banking system generally causes bank failure. An economy that is stagnant is mainly responsible for non-performing loan which is an indication of degradation of assets quality.
There are differences in public sector banks, joint venture banks and domestic private banks in terms of profitability, capital adequacy, asset quality, riskiness, size, liquidity and management effectiveness.One of the most effective ways of improving the economic indicators is by decreasing the NPLs. Boudrigaet al. (2009) found positive relationship between capital adequacy ratio and non-performing loan. , Jimenez andSaurina (2006) attributed the excessive increase in loan ratio as the main reason for high non-performing loans.Qin & Pastory(2012) revealed that liquidity and asset quality have positive impact in profitability.Demirguc-Kunt and Huizinga (1999) found that there is positive association between economic growth and financial sector profitability. According to Haggler (1977), inflation severely affects the banks’ profitability.
The major objective of the study is to identity the determinants of assets quality and profitability of the Nepalese commercial banks. The study is based on secondary data of 17 commercial banks with 187 observations for the period of 2004/05 to 2014/15. The main source of data include various issues of Banking and Financial Statistics, Quarterly Economic Bulletin, Bank Supervision Report published by Nepal Rastra Bank and Annual Reports of selected commercial banks. . Similarly, macro-economic variables are collected from World Development Indicators maintained by World Bank.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 identifying the determinants of assets quality and profitability of Nepalese commercial banks.
The results shows that NBBL has the highest average NPA,, and NBL has the highest average EPS among the selected commercial banks throughout the study period. Similarly, the average operating expense ratio is highest for ADBL (8.64 percent), average credit to deposit ratio is highest for LUBL (107.98 percent), average capital adequacy ratio is highest for SCBL (15.73 percent), and average total asset is highest for ADBL (Rs. 69.42 billion).
The descriptive statistics for joint venture bank shows that the average non-performing assets, earnings per share, operating expense ratio, credit to deposit ratio, capital adequacy ratio, firm size, gross domestic product, and inflation is 4.13 percent, Rs. 66.03 per share, 4.01 percent, 67.45 percent, 11.22 percent, Rs. 46.18 billion, 4.25 percent, and 8.53 percent respectively. Similarly, the descriptive statistics for the public bank reveals that the average non-performing assets, earnings per share, operating expense ratio, credit to deposit ratio, capital adequacy ratio, firm size, gross domestic product, and inflation is 11.45 percent, 94.28 percent, 7.56 percent, 79.19 percent, 0.38 percent, Rs. 66.03 billion, 4.25 percent, and 8.53 percent respectively. The results for the private banks reveals that the average non-performing assets, earnings per share, operating expense ratio, credit to deposit ratio, capital adequacy ratio, firm size, gross domestic product, and inflation is 2.54 percent, Rs. 22.43 per share, 2.53 percent, 82.63 percent, 11.48 percent, Rs. 27.79 billion, 4.25 percent, and 8.53 percent respectively.
In case of joint venture banks, capital adequacy ratio, firm size, and gross domestic product are negatively related to non-performing assets. Results also show thatcapital adequacy ratio, firm size, and gross domestic product are positively related to earnings per share. On the other hand, the study of the public banks reveals that credit to deposit ratio, capital adequacy ratio, gross domestic product, and inflation are negatively related to non-performing assets and earnings per share whereas firm size is positively related to earnings per share. Likewise, the study of private banks reveals that the operating expense ratio is negatively related to non-performing assets and earnings per share. However, results show that inflation is positively related to non-performing assets for private banks.
The regression results show that capital adequacy ratio and firm size have negative and significant impact on the non-performing assets of all categories of Nepalese commercial banks. Likewise, inflation has significant negative impact on the non-performing assets of public banks, where beta coefficients are significant at 5 percent level of significance. However, the beta coefficients are positive for inflation in the case of joint venture and private banks. Likewise, results show that credit to deposit ratio and capital adequacy ratio have positive impact on earnings per share in the context of joint venture and private banks. However, the beta coefficients are negative for public banks. On the other hand, firm size has positive impact on the earnings per share of joint venture, public, and private banks. However, non-performing loans has negative impact on the earnings per share of all categories of Nepalese commercial banks. Thus, capital adequacy ratio and firm size are the major factors determining the assets quality whereas non-performing loans is the major factor influencing the profitability of Nepalese commercial banks.
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Barcode Call number Media type Location Section Status 261/D 330.954 SAP Thesis/Dissertation Uniglobe Library Social Sciences Available Determinants of bank deposits: a survey of selected commercial banks in Nepal / Akash Khaniya
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