Determinants of Vietnamese Commercial Bank Profitability: The Moderating Role of Bank Size

Tóm tắt

This study is an attempt to examine the determinants of Vietnamese commercial bank profitability under the moderating role of bank size. It uses
the balanced panel data of 25 Vietnamese commerical banks in the period
2009-2021 and applies several regression estimation techniques such as
FEM, REM, FGLS and PCSE. The results find evidence to support diseconomies of scale in Vietnam banking system, the positive impact of credit risk,
bank capital, liquidity, and loan volume and the negative effect of cost ratio
on bank profitability. Especially, our study confirmed the moderating role of
bank size on all important internal variables at a significant level. The bank
size can restrain the positive impact on profitability of some bank-specific
factors such as credit risk, bank capital, loan volume but it can also lighten
the harmful effect of several factors such as liquidity and cost ratio. The
findings have some important policy and management implications. The
study is also relevant to different stakeholders in maintaining a sound and
efficient banking system