IDEAS home Printed from https://ideas.repec.org/a/ajn/jobafd/v3y2019ip1-9id32.html
   My bibliography  Save this article

The Use of DuPont Modified Financial Model in Evaluating the Financial Performance of Kuwaiti Banks

Author

Listed:
  • Musaed S. AlAli

Abstract

The aim of this study is to measure the financial performance of Kuwaiti banks over the period 2012 to 2017 using the modified DuPont system of financial analysis which is based on the analysis of return on equity model. The return on equity model disaggregates performance into three components: net profit margin, total asset turnover, and the equity multiplier. The banking sector is the largest sector in the Kuwait stock market, the market capitalization for the banking sector accounts for almost 50% of the total market capitalization. Results from this study showed that in terms of the original DuPont model that considers return on assets (ROA) as the ultimate goal of the model, National bank of Kuwait came at the top of Kuwaiti banks followed by Ahli United bank. But when it comes to the modified DuPont model, Ahli united bank was the best performer among Kuwaiti banks in terms of return on equity (ROE) followed by National bank of Kuwait. On the flipside, Warba bank was the worst performer among all Kuwaiti banks followed by AlAhli bank.

Suggested Citation

  • Musaed S. AlAli, 2019. "The Use of DuPont Modified Financial Model in Evaluating the Financial Performance of Kuwaiti Banks," Journal of Banking and Financial Dynamics, Eastern Centre of Science and Education, vol. 3, pages 1-9.
    • Handle: RePEc:ajn:jobafd:v:3:y:2019:i::p:1-9:id:32
    as

    Download full text from publisher

    File URL: https://ecsenet.com/index.php/2576-6821/article/view/32/31
    Download Restriction: no
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ajn:jobafd:v:3:y:2019:i::p:1-9:id:32. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Tracy William (email available below). General contact details of provider: https://ecsenet.com/index.php/2576-6821/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.