Paper Title :Impact of Bank Specific and Macroeconomic Variables on Investment of Commercial Banks in Nepal

Author :Bishnu Prasad Bhattarai

Article Citation :Bishnu Prasad Bhattarai , (2018 ) " Impact of Bank Specific and Macroeconomic Variables on Investment of Commercial Banks in Nepal " , International Journal of Management and Applied Science (IJMAS) , pp. 8-13, Volume-4,Issue-4

Abstract : The main purpose of this study is to analyze the impact of bank specific and macroeconomic variables on investment of commercial banks in Nepal. This study is based on secondary data commercial banks for the period of 2009/10 - 2015/16. The data are obtained from annual report of concerned banks. The descriptive and causal comparative research design has been used for the study. The relationship between investment and size(SZ), non interest income(NII), credit to deposit ratio (CD), Spread, cost of production(COP), cash, return on assets(ROA), profit before tax(PRFT), gross domestic product(GDP), Interest rate, exchange rate(ER), inflation rate has been analyzed with the help of the multiple regression technique from SPSS- 18 version. The limitation of this research is that only sample commercial banks annual reports for the period 2009/2010 to 2015/2016 have been taken in order to address the subject under investigation. The predictors of investment have been limited by size(SZ), non interest income(NII), credit to deposit ratio (CD), Spread, cost of production(COP), cash, return on assets(ROA), profit before tax(PRFT), gross domestic product(GDP), Interest rate, exchange rate(ER), inflation rate(IR). Thus, this study concludes that NII, CD, GDP and ER the major factors are affecting the investment of commercial banks in Nepal. Whereas NII is positive impact on Investment and rest three variables are negative effects. The findings of the study is valuable for bank managers, board of directors and regulator in assessing the strengths and weakness of the banks in the management of investment, where as its impact heading about in the future. Keywords - Bank, Impact, size, non interest income, credit to deposit ratio, Spread, cost of production, cash, return on asset, profit before tax, gross domestic product, Interest rate, exchange rate, inflation rate.

Type : Research paper

Published : Volume-4,Issue-4

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