Self Sustainability of SME Banks - A Myth or Reality? Evidence From Selected Developing Economies Across Asia

Rafay, A., Ajmal, M. & Khalid, Z. (2017). Self Sustainability of SME Banks - A Myth or Reality? Evidence from Selected Developing Economies across Asia. SMEDA Research Journal, 3(1), 64-74.

14 Pages Posted: 23 Mar 2017 Last revised: 4 Mar 2021

See all articles by Abdul Rafay

Abdul Rafay

University of Management & Technology (UMT), Pakistan

Muhammad Ajmal

University of Management and Technology (UMT), Pakistan

Zunera Khalid

University of Management and Technology (UMT), Pakistan

Date Written: December 31, 2016

Abstract

The purpose of this study is to explore those contributory factors that affect the sustainability of SME banks in selected developing economies across Asia (Pakistan, India, Sri-Lanka, Nepal, Malaysia, Bangladesh and Thailand). This study used a sample data of SME banks working in these economies during the period 2005-2015. All the findings of empirical model concluded that there is a significant impact of Gross Loan Portfolio (GLP), Deposits (DP) and Debt to Equity Ratio (D_E) on Sustainability (OSS) of SME banks. No significant relationship was found between operating self-sufficiency with Return on Assets (ROA) and Portfolio at Risk (PAR). By focusing these contributory factors, policy makers and regulators can devise policies to support the long term sustainability of SME banks. These contributory factors are not only useful to determine the sustainability of SME banks but can also assist the future researchers in unfolding further factors for sustainability of other SME financial institutions.

Keywords: SME, Assets, Portfolio, Sustainability, Deposits, Debt, Equity, ROA

JEL Classification: G21, G28

Suggested Citation

Rafay, Abdul and Ajmal, Muhammad and Khalid, Zunera, Self Sustainability of SME Banks - A Myth or Reality? Evidence From Selected Developing Economies Across Asia (December 31, 2016). Rafay, A., Ajmal, M. & Khalid, Z. (2017). Self Sustainability of SME Banks - A Myth or Reality? Evidence from Selected Developing Economies across Asia. SMEDA Research Journal, 3(1), 64-74., Available at SSRN: https://ssrn.com/abstract=2939024

Abdul Rafay (Contact Author)

University of Management & Technology (UMT), Pakistan ( email )

C-II
Johar Town
Lahore, Punjab 54770
Pakistan
924235212801-10 (Phone)

HOME PAGE: http://www.umt.edu.pk

Muhammad Ajmal

University of Management and Technology (UMT), Pakistan ( email )

C-II
Lahore, Punjab 54770
Pakistan

Zunera Khalid

University of Management and Technology (UMT), Pakistan ( email )

Johar Town - Phase 1
Lahore, Punjab 54770
Pakistan

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