Evaluation of the Effect of Macroeconomic Variables and Islamic Financing on the Efficiency of Private and Public Banks in Iran

Subject Areas : Labor and Demographic Economics

morteza jalalzadeh azar ¹ , roya aleemran ² , Hossein Panahi ³ , Hossein Asgharpur ⁴

1 - PhD Student, Department of Economics, Tabriz Branch, Islamic Azad University, Tabriz, Iran
2 - Associate Professor, Department of Economics, Tabriz Branch, Islamic Azad University, Tabriz, Iran
3 - Professor and Dean of Faculty of Economics and Management, University of Tabriz
4 - Professor, Department of Economics, Tabriz University, Tabriz, Iran

Received: 2020-06-30 Accepted : 2021-01-21 Published : 2020-09-22

Keywords: inflation, Returns, Bank Size, Chequk, H82, Classification JEL: L32, E42. Keywords: Bank Ownership,

Abstract :

The purpose of this article is to investigate the effect of macroeconomic variables and Islamic financing (Sukuk) on the returns of private and public banks in Iran (15 banks in total) using the panel data method during the period 1384-1396. The results of model estimation showed that sukuk, inflation, ratio of equity to total assets (as a variable of the bank) have a positive and significant effect on banks' returns. This means that the issuance of sukuk increases the efficiency and profitability of banks. The findings showed that government ownership has a negative impact on banks' returns; So that with increasing government share of banks, profitability and, consequently, the efficiency of banks decreases; The ratio of total expenditures to total assets also has a negative and significant effect on banks' returns and the size of the bank also has a negative and significant effect on bank returns. Whereas state ownership negatively affects the efficiency of banks; Please reduce the government's share of the bank's ownership.

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