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Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.]

This study examined the effectiveness of regulatory capital in enhancing efficiency and credit growth and reducing bad loans in commercial banks listed on the Pakistan Stock Exchange (PSX) from 2010 to 2019. Precisely, the impact of capital adequacy ratio (CAR) was studied on net interest margin (NI...

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Main Authors: Malik, Amina, Butt, Babar Zaheer, Ud Din, Shahab, Aziz, Haroon
Format: Article
Language:English
Published: Universiti Teknologi MARA 2021
Subjects:
Accounting. Bookkeeping
Banking
Online Access:https://ir.uitm.edu.my/id/eprint/2910/1/2910.pdf
https://ir.uitm.edu.my/id/eprint/2910/
https://apmaj.uitm.edu.m/
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spelling my.uitm.ir.29102022-07-05T07:25:29Z https://ir.uitm.edu.my/id/eprint/2910/ Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.] Malik, Amina Butt, Babar Zaheer Ud Din, Shahab Aziz, Haroon Accounting. Bookkeeping Banking This study examined the effectiveness of regulatory capital in enhancing efficiency and credit growth and reducing bad loans in commercial banks listed on the Pakistan Stock Exchange (PSX) from 2010 to 2019. Precisely, the impact of capital adequacy ratio (CAR) was studied on net interest margin (NIM), credit growth (CR) and non-performing loans (NPLs). The impact of capital adequacy regulations was assessed by retrieving data from financial statements analysis (FSA), Bank Financial statements and the World Bank website. Panel regression models including ordinary least squares (OLS), fixed and random effects under robust title were applied in this study. Results revealed that the implementation of stringent CAR plays the role of panacea and increases interest margin & credit growth and a reduction of NPL in Pakistani commercial banks. The study provides practical results for regulators to customize regulations on credit growth to reduce non-performing loans and maintain healthy growth of loans by not compromising on interest margins as well as maintenance of minimum capital adequacy ratios. With the high significance of stringent minimum capital adequacy for banks, the findings of the study are valuable for regulators, banks, auditors and investors, as capital adequacy ratio commonly plays the role of Panacea in terms of efficiency, credit growth and reduction in non-performing loans. Universiti Teknologi MARA 2021-08 Article PeerReviewed text en https://ir.uitm.edu.my/id/eprint/2910/1/2910.pdf Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.]. (2021) Asia-Pacific Management Accounting Journal (APMAJ), 16 (2): 23. pp. 265-287. ISSN (eISSN):2550-1631 https://apmaj.uitm.edu.m/
institution Universiti Teknologi Mara
building Tun Abdul Razak Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Teknologi Mara
content_source UiTM Institutional Repository
url_provider http://ir.uitm.edu.my/
language English
topic Accounting. Bookkeeping
Banking
spellingShingle Accounting. Bookkeeping
Banking
Malik, Amina
Butt, Babar Zaheer
Ud Din, Shahab
Aziz, Haroon
Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.]
description This study examined the effectiveness of regulatory capital in enhancing efficiency and credit growth and reducing bad loans in commercial banks listed on the Pakistan Stock Exchange (PSX) from 2010 to 2019. Precisely, the impact of capital adequacy ratio (CAR) was studied on net interest margin (NIM), credit growth (CR) and non-performing loans (NPLs). The impact of capital adequacy regulations was assessed by retrieving data from financial statements analysis (FSA), Bank Financial statements and the World Bank website. Panel regression models including ordinary least squares (OLS), fixed and random effects under robust title were applied in this study. Results revealed that the implementation of stringent CAR plays the role of panacea and increases interest margin & credit growth and a reduction of NPL in Pakistani commercial banks. The study provides practical results for regulators to customize regulations on credit growth to reduce non-performing loans and maintain healthy growth of loans by not compromising on interest margins as well as maintenance of minimum capital adequacy ratios. With the high significance of stringent minimum capital adequacy for banks, the findings of the study are valuable for regulators, banks, auditors and investors, as capital adequacy ratio commonly plays the role of Panacea in terms of efficiency, credit growth and reduction in non-performing loans.
format Article
author Malik, Amina
Butt, Babar Zaheer
Ud Din, Shahab
Aziz, Haroon
author_facet Malik, Amina
Butt, Babar Zaheer
Ud Din, Shahab
Aziz, Haroon
author_sort Malik, Amina
title Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.]
title_short Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.]
title_full Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.]
title_fullStr Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.]
title_full_unstemmed Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.]
title_sort regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / amina malik …[et al.]
publisher Universiti Teknologi MARA
publishDate 2021
url https://ir.uitm.edu.my/id/eprint/2910/1/2910.pdf
https://ir.uitm.edu.my/id/eprint/2910/
https://apmaj.uitm.edu.m/
_version_ 1738513837593722880
score 13.211869

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