Bank Specific Determinants Of Profitability In Turkish Banks

Author

Ahmet Karakuza, Fort Hays State UniversityFollow

Document Type

Thesis

DOI

10.58809/FBLP3230

Date of Award

Spring 2017

Degree Name

Master of Business Administration (MBA)

Department

Economics, Finance, & Accounting

Advisor

Dr. Glenn Growe

Abstract

This paper examines the profitability of Turkish commercial banks during the period 2005 – 2014. We use bank – specific determinants to predict the following years’ profitability measured by return on assets (ROA). Among the performance measures, the amount of net interest income as a proportion of total operating income is positive related to profitability. It remains important for banks to loan money out at a rate higher than their cost of capital. Non-interest income as a proportion of total assets is strongly positively related to profitability. Consumer loans as a proportion of total loans is negatively related to profitability. Our findings indicate that while the traditional source of bank profits from lending remains crucial, diversifying away from consumer loans into earning income from non-interest sources is important for enhancing bank profitability.

Comments

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Recommended Citation

Karakuza, Ahmet, "Bank Specific Determinants Of Profitability In Turkish Banks" (2017). Master's Theses. 6.
DOI: 10.58809/FBLP3230
Available at: https://scholars.fhsu.edu/theses/6

Rights

© 2017 Ahmet Karakuza