Impact of Basel II Implementation on the Financial Performance of Private Commercial Banks of Bangladesh

European Journal of Economics, Finance and Administrative Sciences, Issue 77 July, 2015

12 Pages Posted: 19 Aug 2015 Last revised: 26 Jan 2017

See all articles by Sarwar Uddin Ahmed

Sarwar Uddin Ahmed

Independent University, Bangladesh (IUB)

Samiul Ahmed

Independent University, Bangladesh (IUB)

M. Nazmul Islam

University of Asia Pacific; BRAC University

G. M. Wali Ullah

Independent University, Bangladesh (IUB)

Multiple version iconThere are 2 versions of this paper

Date Written: July 2015

Abstract

To ensure financial stability and development, capital adequacy framework of financial institutes is an integral part for global business. In recent times, BASEL-II has been implemented globally and its outcome has been constructive for financial institutions. Considering the current condition of financial institution of Bangladesh it has become important for Bangladesh to implement BASEL-II adequately to get sound financial performance. Accordingly, this study aimed to explore to what extent the capital control endeavor influences the financial performance of the banks in Bangladesh. To investigate, this article explores relevant secondary data of 25 listed private commercial banks (out of 30) in Bangladesh for the time horizon of 5 years (2008-2012). Particularly, the article used multivariate panel OLS regression model where financial performance or profitability of commercial banks was measured in terms of relevant influencing variables (e.g. asset turnover, size of the firm, capital adequacy ratios). The result shows that the capital adequacy requirement might have a positive impact on the profitability of the commercial banks in Bangladesh.

Keywords: Basel II, Financial Performance, Private Commercial Banks, Banking, Bangladesh

Suggested Citation

Ahmed, Sarwar Uddin and Ahmed, Samiul and Islam, M. Nazmul and Ullah, G. M. Wali, Impact of Basel II Implementation on the Financial Performance of Private Commercial Banks of Bangladesh (July 2015). European Journal of Economics, Finance and Administrative Sciences, Issue 77 July, 2015 , Available at SSRN: https://ssrn.com/abstract=2645671 or http://dx.doi.org/10.2139/ssrn.2645671

Sarwar Uddin Ahmed

Independent University, Bangladesh (IUB) ( email )

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HOME PAGE: http://www.sb.iub.edu.bd/

Samiul Ahmed

Independent University, Bangladesh (IUB) ( email )

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Bangladesh

M. Nazmul Islam (Contact Author)

University of Asia Pacific ( email )

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Bangladesh

BRAC University ( email )

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Dhaka 1212 Bangladesh
Dhaka, 1212
Bangladesh

G. M. Wali Ullah

Independent University, Bangladesh (IUB) ( email )

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Bashundhara R/A
Dhaka, 1212
Bangladesh
+8801793-514567 (Phone)

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