:: Volume 14, Issue 4 (Fall 2019) ::
J. Mon. Ec. 2019, 14(4): 495-524 Back to browse issues page
Sustainability of Iranian Banks: Role of Financial and Non-Financial Determinants
Emad Nobahar1, Mahmoud Dehghan Nayeri 1, Adel Azar1
1- Tarbiat Modares University
Abstract:   (741 Views)
This study aimed to investigate the role of financial and non-financial determinants of the sustainability of Iranian banks. Accordingly, the sustainability score of 27 public and private Iranian banks were evaluated in 2017 by employing a sustainability model. The model was developed by the acquisition of sustainability codes, themes, and categories in the banking industry through Meta Synthesis, while its casual structure was determined by a combined method of Interpretive Structural Modeling and Analytical Network Process. Subsequently, we calculated the sustainability scores by using our proposed model to analyze the content of the banks’ disclosed information. Then, the effect of capital adequacy, total assets, financial leverage, loan to deposit ratio, return on assets and number of branches were investigated using multiple regressions on the banks' sustainability scores. Findings depict that total assets have a positive and significant relationship and capital adequacy has a negative and significant relationship with a bank's sustainability. Therefore, banks with more assets are more willing to participate in sustainability activities, due to more appropriate financial resources, as well as to support the bank's brand and its reputation to stakeholders. On the other hand, due to the wrong belief that sustainability is costly, and non-value adding for the banks, they get less involved in order to increase their capital adequacy ratio.
Keywords: Bank Sustainability, Financial Determinants, Regression
Full-Text [PDF 563 kb]   (406 Downloads)    
Type of Study: Original Research - Theoric | Subject: Microeconomics
Received: 25 Jun 2019 | Accepted: 31 Mar 2020 | Published: 14 Apr 2020

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Volume 14, Issue 4 (Fall 2019) Back to browse issues page