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:: Volume 10, Issue 1 (Winter 2015) ::
J. Mon. Ec. 2015, 10(1): 107-129 Back to browse issues page
Effective Factors on Bank Profitability in Iran
Mehrzad Ebrahimi 1, Ali Arshadi2, Mohamad Sadegh Salimi3
1- Faculty of Economics and Management, Islamic Azad University of Shiraz
2- Monetary and Banking Research Institute (MBRI)
3- Islamic Azad University of Shiraz
Abstract:   (1341 Views)

Not only in Iran, but throughout the world, banks and banking industry are considered as very important parts of the economy. This study seeks to investigate the impact of the internal characteristics of banks, the structure of the banking industry and the economic situation of Iran on the profitability of the banking system of Iran by exploring the theory of the Structuralism school concerning the impact of structure on profitability. To this end, data relating to 18 private and public banks of Iran during 2003 to 2012 are analyzed by using panel data methods. First, the profitability of the banking system is calculated using relevant indicators; and then, the impact of various internal, structural and environmental factors on bank profitability is evaluated. The results show that internal factors - the amount of capital and the size of the bank - have a positive impact on profitability. Besides, structural factors including market share and concentration are shown to have a positive impact on profitability whereas ownership appears to have no significant impact. Furthermore, inflation and economic cycles – among environmental factors – exhibit a positive impact on profitability.

JEL Classifications: C23, D22, L22, L25

Keywords: The banking industry of Iran, Profitability, Return on assets, Structuralism theory
Full-Text [PDF 885 kb]   (1284 Downloads)    
Type of Study: Research | Subject: Macroeconomics
Received: 2015/12/7 | Accepted: 2016/07/6
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Ebrahimi M, Arshadi A, Salimi M S. Effective Factors on Bank Profitability in Iran. J. Mon. Ec.. 2015; 10 (1) :107-129
URL: http://jme.mbri.ac.ir/article-1-190-en.html


Volume 10, Issue 1 (Winter 2015) Back to browse issues page
Journal of Money and Economy Journal of Money And Economy
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