A comparative study of the performance of local and foreign banks in Pakistan:
Rustam, Adeela
A comparative study of the performance of local and foreign banks in Pakistan: some anova evidence Adeela Rustam and Kashif Rashid - Hydrabad IUP Publication Februaury 2015 - 7-20 p. Paper
The paper measures the financial performance of local and foreign banks operating in Pakistan, and secondly it investigates the causes of performance deficiencies. The performance of the sample banks is measured by using one-way Analysis of Variance (ANOVA). The paper uses three parameters and proxies to measure bank performance—profitability, financial structure and efficiency. The determinants used for estimation of these three parameters are Return on Assets (ROA), Return on Equity (ROE), Net Profit Margin (NPM), Debt-to-Equity Ratio (DER), Capital Adequacy Ratio (CAR) and Operating Expense-to-Assets (OETA) ratio. The first stage of findings indicates that foreign banks have a sound financial structure compared to the local banks. The second stage of findings indicates that the ROA and ROE of foreign banks are comparatively higher than that of the local counterparts. The results at the second stage also show that NPM of foreign banks is higher than that of local banks. Finally, the third stage of analysis finds that local Pakistani banks are less cost-efficient than foreign banks operating in Pakistan.
Banks--Pakistan
Foreign Banks --Pakistan
A comparative study of the performance of local and foreign banks in Pakistan: some anova evidence Adeela Rustam and Kashif Rashid - Hydrabad IUP Publication Februaury 2015 - 7-20 p. Paper
The paper measures the financial performance of local and foreign banks operating in Pakistan, and secondly it investigates the causes of performance deficiencies. The performance of the sample banks is measured by using one-way Analysis of Variance (ANOVA). The paper uses three parameters and proxies to measure bank performance—profitability, financial structure and efficiency. The determinants used for estimation of these three parameters are Return on Assets (ROA), Return on Equity (ROE), Net Profit Margin (NPM), Debt-to-Equity Ratio (DER), Capital Adequacy Ratio (CAR) and Operating Expense-to-Assets (OETA) ratio. The first stage of findings indicates that foreign banks have a sound financial structure compared to the local banks. The second stage of findings indicates that the ROA and ROE of foreign banks are comparatively higher than that of the local counterparts. The results at the second stage also show that NPM of foreign banks is higher than that of local banks. Finally, the third stage of analysis finds that local Pakistani banks are less cost-efficient than foreign banks operating in Pakistan.
Banks--Pakistan
Foreign Banks --Pakistan