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http://dx.doi.org/10.13106/jafeb.2020.vol7.no11.219

The Determinants of Listed Commercial Banks' Profitability in Vietnam  

PHAN, Hai Thanh (Faculty of Accounting, Institute of Research and Development, Duy Tan University)
HOANG, Tien Ngoc (Graduate School, Duy Tan University)
DINH, Linh Viet (Shinhan Bank)
HOANG, Dat Ngoc (Indovina Bank Ltd.)
Publication Information
The Journal of Asian Finance, Economics and Business / v.7, no.11, 2020 , pp. 219-229 More about this Journal
Abstract
The study investigates the factors affecting the profitability of listed commercial banks in Vietnam. Survey data for this research were collected from 10 Vietnamese listed commercial banks for the period from 2008 to 2018. In the study, we have built a model of econometric regression with the dependent variable being listed commercial banks' profitability results measured through ROA. The research methods used include descriptive statistics, IV regression and OLS regression analysis, and the authors carried out the model verification with Stata 14 software. The results showed that operating efficiency, loans size, retail loans ratio, state ownership, inflation rate, and GDP growth are factors that have a positive impact on profitability On the other hand, variables such as capital size, credit risk, liquidity risk, bank size, and revenue diversification are statistically insignificant; hence, these variables are not statistically adequate to indicate the influence of those independent variables to banks' profitability. The findings of this study suggest that the quality of assets should be considered in the context that bad debt risks come from lending heavily to the real estate sector. Meeting Basel II's capital compliance requirements is relatively difficult for small listed commercial banks compared to bigger listed commercial banks in Vietnam.
Keywords
Listed Commercial Banks; Profitability; OLS Regression; IV Regression; Vietnam;
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Times Cited By KSCI : 8  (Citation Analysis)
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