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
Date Written: December 31, 2016
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: Suggested Citation