Relationship Between Bank Profitability and Balance Sheet Structure: Sample of Türkiye

Authors : Servet Say

Pages : 21-27

View : 68 | Download : 96

Publication Date : 2024-12-30

Article Type : Research Paper

Abstract :A strong banking sector means that the country\\\'s economy is also strong. Banks, like other businesses, aim to make a profit. Therefore, determining the factors affecting bank profitability is important in this sense. The aim of this study is to examine the effect of ratios related to the balance sheet structure of banks on profitability. In the research, data for the years 2005-2022 of 14 banks operating in Türkiye, which are members of The Banks Association of Türkiye (TBB), were used. In the study, accounting-based performance indicators return on assets (ROA) and return on equity (ROE) ratios were used as dependent variables. The independent variables are the total deposits/total assets ratio and the loans received/total assets ratio. Panel Corrected Standard Errors Method (PCSE) was used in empirical analyses. As a result of the analysis, a positive and statistically significant relationship was detected between balance sheet structure ratios and ROA, ROE. In other words, increasing deposits and loans within assets increases profitability per asset and per equity capital.
Keywords : Bankalar, Bilanço Yapısı, Karlılık