The Impact of Bank's Asset and Liability Structure on their Profitability Regardless of Monetary Policy and Size: A Panel Analysis

Abstract

The study examines the impact of bank's asset and liability structure on their profitability without monetary policy and size; the study utilizes panel data with cross section analysis on data of 10 unit banks according to the annual balance sheet & performance. The populations of the study are bank units listed on Egyptian Exchange (EGX), the study’s data collection covered the duration from 2008 till 2016. Eventually, the study ascertained that there is an impact of the bank's asset and liability structure on their profitability according to "Return on Asset" and "Return on Equity"; however, the interprets of bank's asset and liability structure for "Return on Equity" more that to "Return on Asset". Therefore, the banking units should work to maintain the optimal rate of the structure of the bank's assets and liabilities; this may be a potential research scope in banks.

Keywords: Banking structure, Banking profitability, Egypt, Panel analysis

JEL Classification: G2; M2; M4