Evaluating the Role of Bank Specific, Macroeconomic, and Institutional Factors in Determining Banking Sector Performance: Evidence from South Asian Economies
Abstract
This study investigates the bank-specific, macroeconomic, and institutional factors affecting the performance of the banking sector specifically profitability and stability in South Asian countries from 2011 to 2020. Using a two-step system GMM estimation method on a balanced panel dataset, the study identifies key determinants, including bank size, operating expenses, economic growth, exchange rates, and economic freedom. Institutional factors, particularly corruption, significantly influence banking sector profitability and stability. The findings offer several policy recommendations to enhance banking sector performance in the region.
Fields of Study & Subjects
Banking stability
regulation
efficiency
Banking Sector Performance and Management
Monetary Policy and Economic Impact
Publication details
- Journal / source
- Bulletin of Monetary Economics and Banking
- Volume
- 29
- Issue
- 1
- Pages
- 77–96
- Publication date
- 9 February 2026
- Language
- EN