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The Impact of Ownership Structure on Vietnamese Commercial Banks' Profitability

Author

Listed:
  • Van-Thep Nguyen

    (Graduate Institute of Finance, National Taiwan University of Science and Technology, Taiwan.)

  • Day-Yang Liu

    (Graduate Institute of Finance, National Taiwan University of Science and Technology, Taiwan.)

Abstract

This study aims to check whether ownership structure affects Vietnamese commercial banks' profitability or not and identify factors influencing Vietnamese commercial banks' profitability as well. Utilizing the Bayesian Model Averaging (BMA) model applying for 21 commercial banks in the period 2010-2017, the authors found that bank ownership is statistically significant and the sign of the correlation coefficient is negative, indicating that state-owned commercial banks are less efficient than other commercial banks. Also, the empirical findings show that there are some factors affecting the profitability of commercial banks in Vietnam such as credit risk, capital adequacy ratio, cost-income ratio, staff expenses, and asset growth rate, where credit risk and cost-income ratio have a negative relation to banks' profitability.

Suggested Citation

  • Van-Thep Nguyen & Day-Yang Liu, 2020. "The Impact of Ownership Structure on Vietnamese Commercial Banks' Profitability," International Journal of Economics and Financial Issues, Econjournals, vol. 10(3), pages 187-194.
    • Handle: RePEc:eco:journ1:2020-03-23
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Bank profitability; Bayesian Model Averaging (BMA); Commercial; Ownership structure; Vietnam;
    All these keywords.

    JEL classification:

    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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