Impact of Global Financial Crisis on Banks’ Financial Performance in Pakistan

American Journal of Scientific Research, ISSN 2301-2005 Issue 78, October, 2012, pp.101-110

10 Pages Posted: 7 Jun 2015 Last revised: 18 Aug 2015

See all articles by Mian Sajid Nazir

Mian Sajid Nazir

COMSATS Institute of Information Technology (CIIT), Lahore

Raheel Safdar

Donbei University of Finance and Economics

Muhammad Imran Akram

University of the Punjab (PU) - Gujranwala Campus

Date Written: June 6, 2012

Abstract

The global financial crisis in 2008 adversely affected the financial setups all around the globe with far reaching consequences for its victims. This study aimed at analyzing various determinants of banks’ financial performance in Pakistan along with intention to ascertain the impacts of global financial crisis on the relative contribution of these determinants towards financial performance. The step-wise multiple regression analysis and pre-post comparison of coefficients were carried out in this regard. This study found that assets quality is the most influential determinant of return over assets (ROA) followed by bank size and solvency. Advances, liquidity, investments, and size have positive while poor assets quality and deposits have negative impact over ROA. A comparison of the pre-crisis and post-crisis coefficients of the determinants of ROA reveled that the global financial crisis has exerted significant impact on the relative ability of these determinants to explain variations in ROA.

Keywords: Global financial crisis; financial performance; financial performance determinants; commercial banks in Pakistan

JEL Classification: G01; G21; E22

Suggested Citation

Nazir, Mian Sajid and Safdar, Raheel and Akram, Muhammad Imran, Impact of Global Financial Crisis on Banks’ Financial Performance in Pakistan (June 6, 2012). American Journal of Scientific Research, ISSN 2301-2005 Issue 78, October, 2012, pp.101-110. Available at SSRN: https://ssrn.com/abstract=2615286

Mian Sajid Nazir

COMSATS Institute of Information Technology (CIIT), Lahore ( email )

Park Road
Chak Shahzad
North-West Frontier Province
Pakistan

Raheel Safdar (Contact Author)

Donbei University of Finance and Economics ( email )

217 Jianshan St,
Shahekou
Dalian, Liaoning
China

Muhammad Imran Akram

University of the Punjab (PU) - Gujranwala Campus ( email )

Lahore, Punjab
Pakistan

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