Investigating the impact of inflation and stock market index on bank profitability (Case study of Karafin, Eghtesad-e Novin and Saman Banks)

Subject Areas : Financial Economics

Reza Rahimi ¹ ( Department of Economics, Central Tehran Branch, Islamic Azad University, Tehran, Iran (corresponding )
Ali Akbar Baghestany ² ( Agricultural Planning, Economic and Rural Development Research Institute (APERDRI). Tehran. Iran )

Received: 2023-09-29 Accepted : 2023-12-02 Published : 2023-12-22

Keywords: Bank, Economy, Stock market, Key Words: Inflation, E64, Iran. JEL classification: E52,

Abstract :

AbstractBanks are economic units that affected by shocks. Because their sources and expenses are affected by the impact of unexpected economic shocks. This study investigates and analyzes the effects of inflation and changes in the stock exchange index on the profitability of three selected banks, Karafin, Eghtesad-e Novin and Saman Banks during the period of 2014-2015 using panel data. The results of the F-Limer indicated that the possibility of estimating the model using the Panel data method is confirmed with 95% confidence. In order to detect the presence of fixed effects or the random effects, Hausman's test was used. The results of the Hausman test showed that the research model is panel data with fixed effects. The results of the model estimation indicate that the economic growth and the growth of the stock exchange index have a positive and significant effect on the profitability of the selected banks. On the other hand, the increase in the general level of prices (inflation) has reduced the profitability of banks. Therefore, it is suggested that the production sectors such as agriculture and industry should be prioritized for financing by banks. So that the economic growth is realized by increasing the supply side of the economy and the profitability of the banks is strengthened by both the economic growth and the reduction of inflation.

References:

فهرست منابع

• ابریشمی، حمید(1373). اقتصاد سنجی کاربردی. انتشارات دانشگاه تهران.


• اطیابی، اعظم سادات، دقیقی اصل، علیرضا، گرایی نژاد، غلامرضا(1402). بررسی اثر مداخله بانک مرکزی بر سودآوری بانک‌های تجاری کشور: رویکرد رگرسیون انتقال ملایم. اقتصاد مالی، 17(63): 247-272. doi: 10.30495/fed.2023.702193


• پروهان، آمنه(1395) . بررسی عوامل موثر بر سودآوری بانک‌های ایران در ایران، پایان‌نامه کارشناسی ارشد، دانشگاه بجنورد.


• پیری، علی(1390). بررسی تاثیر ویژگیهای بانک و عوامل اقتصاد کلان بر سودآوری بانک‌های اسلامی، پایان‌نامه کارشناسی ارشد، موسسه عالی بانکداری.


• تقوی، مهدی(1384). اصول علم اقتصاد 2 (اقتصاد کلان ) چاپ سوم، دانشگاه پیام نور.


• شوال پور سعید، و اشعری الهام(1392). بررسی تاثیر ریسک اعتباری بر سودآوری بانک‌ها در ایران. تحقیقات مالی، 15(2): 229-246. doi: 10.22059/jfr.2013.51079


• عقبائی، فرشته، رضائیان، علی، الوانی، سید مهدی، هاشمی سید ذبیح الله(1401). سودآوری مالی با تعیین الگوی روابط بین عوامل موثر بر فرهنگ مشتریان خدمات بانکداری الکترونیکی (مورد مطالعه: بانک ملت). اقتصاد مالی، 16(60): 45-68. doi: 10.30495/fed.2022.697604


• محمدی گیگلو، اسلام(1383). نگرش و روش در تحقیق. تهران. نشر دنیای پژوهش، ص 99 .


• محمدی، پریسا(1394). بررسی اثر نااطمینانی متغیرهای کلان اقتصادی بر سودآوری بانک ملت پایان‌نامه کارشناسی ارشد، دانشگاه آزاد اسلامی واحد تهران مرکزی.

نگین تاجی، زریر، گلمرادی آدینه وند، حسن، صادقی‌نژاد مرتضی علی(1401). بررسی رابطه میان رشد اقتصادی، توسعه بخش بانکی و بازار سرمایه در ایران. اقتصاد مالی، 16(60): 195-212. doi: 

• Athanasoglou, P. P., Brissimis, S. N., & Delis, M. D. (2008). Bank-specific, industry-specific and macroeconomic determinants of bank profitability. Journal of international financial Markets, Institutions and Money, 18(2), 121-136.‏


• Bikker, J. A., & Hu, H. (2002). Cyclical patterns in profits, provisioning and lending of banks and procyclicality of the new Basel capital requirements. PSL Quarterly Review, 55(221).


• Dorrucci, E., Meyer-Cirkel, A., & Santabárbara, D. (2009). Domestic financial development in emerging economies: Evidence and implications. ECB occasional paper, (102).


• Francis, M. E. (2013). Determinants of commercial bank profitability in Sub-Saharan Africa. International journal of economics and finance, 5(9), 134-147.‏


• Goddard, J., Molyneux, P., & Wilson, J. O. (2004). The profitability of European banks: a cross‐sectional and dynamic panel analysis. The Manchester School, 72(3), 363-381.


• Grose, C., Kanella, A., Kargidis, T., Mocanu, M., & Spyridis, Τ. (2021). Determinants of Bank Profitability in UK on the Eve of the Brexit. The Changing Financial Landscape: Financial Performance Analysis of Real and Banking Sectors in Europe, 187-203.‏


• Hassan, M. K., & Bashir, A. H. M. (2003, December). Determinants of Islamic banking profitability. In 10th ERF annual conference, Morocco (Vol. 7, pp. 2-31).


• Kar, M., Nazlıoğlu, Ş., & Ağır, H. (2011). Financial development and economic growth nexus in the MENA countries: Bootstrap panel granger causality analysis. Economic modelling, 28(1-2), 685-693.‏


• King, R. G., & Levine, R. (1993). Finance and growth: Schumpeter might be right. The quarterly journal of economics, 108(3), 717-737.‏


• Kohlscheen, E., Murcia Pabón, A., & Contreras, J. (2018). Determinants of bank profitability in emerging markets.‏


• Kosmidou, K. (2008). The determinants of banks' profits in Greece during the period of EU financial integration. Managerial finance, 34(3), 146-159.‏


• McKinnon, R. I. (2010). Money and capital in economic development. Brookings Institution Press.‏


• Pasiouras, F., & Kosmidou, K. (2007). Factors influencing the profitability of domestic and foreign commercial banks in the European Union. Research in international business and finance, 21(2), 222-237.‏


• Pradhan, R. P., Arvin, M. B., Hall, J. H., & Bahmani, S. (2014). Causal nexus between economic growth, banking sector development, stock market development, and other macroeconomic variables: The case of ASEAN countries. Review of Financial Economics, 23(4), 155-173.‏


• Schumpeter, J.A. (1932). The Theory of Economic Development, Trans. Opie, Harvard University Press, Cambridge, MA


• Shaw, E. S. (1973). Financial deepening in economic development.‏ Oxford University Press, New York.


• Sihotang, M. K., Hasanah, U., & Hayati, I. (2022). Model of sharia bank profitability determination factors by measuring internal and externals variables. Indonesian Interdisciplinary Journal Of Sharia Economics (Iijse), 5(1), 235-251.‏