Effect of inflation rate on banks profitability pdf

As per the study inflation rate had a negative and significant effect on bank profitability. Lardic & Mignon (2003) studied the relationship between interest rate and 

– The purpose of this paper is to evaluate the determinants of bank profitability in China. It examines the effects of inflation on bank profitability, while controlling for comprehensive bank‐specific and industry‐specific variables., – The sample comprises a total of 101 banks (five state‐owned banks, 12 joint‐stock commercial banks and 84 city commercial banks). rate fluctuations could be an important source of risk for banking institutions. In the worst case, large foreign exchange losses could lead to bank failures besides causing huge burdens on banks’ profitability. The research objective was to determine the effects of exchange rate fluctuations on financial performance of commercial banks in Kenya. How changes in interest rates affect banks’ performance has been a subject of much practical and some academic research. Obviously, bank shareholders and other investors are keenly interested in how changes in interest rates affect the income and profitability of banks (e.g., see banking and investment textbooks such as Mishkin, 2015). The study conducted to check and examine the market interest rate effect on the bank's profitability in public and private sectors of Pakistan.

that all three macroeconomic variables (GDP growth, Interest rate and Inflation) included in their analysis have a positive and significant effect on banks' profit.

banks have real assets and liabilities as well (land. buildings, office equipment, equities. etc.). These, however, make up a very small portion of bank portfolios and are irrelevant in assessing the effect of inflation on banks. G. 2 Sanfoni is a senior economist at the Federal Reserve BankofSt. Louis, Thomas A. Pollmannprovidedresearch the determinants factor of the bank profitability there the previous literature also shown and its included in the study. In 2008, the inflation rate is 20.3 per cent, and in 2009 13.6 percent in 2010 13.3, in 2011 inflation rate 11.9 percent and in 2012 the inflation rate is 9.7 here lower point higher the above period, Determinants of Profitability: Empirical Evidence from the Largest Global Banks Antonio Iacobelli The inflation rate of a country can have a significant effect on the profitability of its banks. effects on bank profitability, there needs to be data and analysis that ranges for a long period of Purpose – The purpose of this paper is to evaluate the determinants of bank profitability in China. It examines the effects of inflation on bank profitability, while controlling for – The purpose of this paper is to evaluate the determinants of bank profitability in China. It examines the effects of inflation on bank profitability, while controlling for comprehensive bank‐specific and industry‐specific variables., – The sample comprises a total of 101 banks (five state‐owned banks, 12 joint‐stock commercial banks and 84 city commercial banks). rate fluctuations could be an important source of risk for banking institutions. In the worst case, large foreign exchange losses could lead to bank failures besides causing huge burdens on banks’ profitability. The research objective was to determine the effects of exchange rate fluctuations on financial performance of commercial banks in Kenya.

determinant of bank profitability has attracted the interest of academic research as well results indicate that bank-specific characteristics and macroeconomic variables explain up to operating expenses increase at a faster rate than inflation. The www.failaka.com/downloads/Profitability_Islamic_Banking.pdf. Accessed 

20 Nov 2014 has an adverse effect on banking sector performance and its spillover effect Inflation affect the purchasing power and bank exchange rate regime, opportunity relationship exist between interest rate and bank profitability.

concentration has positive impacts on Tunisian banking profitability. More fact, high inflation rates are generally associated with high loan interest rates, and.

largest effect on profitability of commercial banks. In comparison to other variables, exchange rates however had least effect on profitability of commercial banks. Inflation only had significant effect on ROA as a measure of profitability of commercial banks. The study recommends that regulatory bodies like Central Bank of As a result it is found that there is strong and positive correlation between interest rate and commercial banks‟ profitability. It means if the value of interest rate is increases/decreases then as result value of banks‟ profitability will also increases/decreases. to determine the influence of macroeconomic factors which are: inflation rate, unemployment level, Gross Domestic Product (GDP), and exchange rate on firm profitability which is reflected by Return on Asset (ROA) ratio. This study uses macroeconomic factors as independent variables, and ROA ratio as dependent variable.

KEYWORDS: Bank Profitability, Inflation, Cost Efficiency, Pakistani Banks effects market surplus because of interest rates granted to borrowers and lenders .

– The purpose of this paper is to evaluate the determinants of bank profitability in China. It examines the effects of inflation on bank profitability, while controlling for comprehensive bank‐specific and industry‐specific variables., – The sample comprises a total of 101 banks (five state‐owned banks, 12 joint‐stock commercial banks and 84 city commercial banks).

The determinants of bank profitability are divided into two: the internal and external studies have found a significant positive impact of inflation rates on banks'. 2 Feb 2015 This research is investigating the effects of macroeconomic variables on the performance of textile industry of H1: Inflation rate have a significant positive impact on the Return on Assets of textile industry in Explanatory Factors of Bank Performance. Internal and external determinants of profitability. bank) leading to changes in ROA, and most of the impact variables had strong negative There is a positive relationship between inflation rate and profitability. H6: http://www.mcser.org/images/stories/2_journal/mjss02/saura%20javaid.pdf . 19 Jul 2015 Bank sizes and macroeconomic variable show no impact on profits. Inflation affects most economic variables, interest rate in particular. determinant of bank profitability has attracted the interest of academic research as well results indicate that bank-specific characteristics and macroeconomic variables explain up to operating expenses increase at a faster rate than inflation. The www.failaka.com/downloads/Profitability_Islamic_Banking.pdf. Accessed