Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.]
This study examined the effectiveness of regulatory capital in enhancing efficiency and credit growth and reducing bad loans in commercial banks listed on the Pakistan Stock Exchange (PSX) from 2010 to 2019. Precisely, the impact of capital adequacy ratio (CAR) was studied on net interest margin (NI...
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| Format: | Article |
| Language: | English |
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Universiti Teknologi MARA
2021
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| Online Access: | https://ir.uitm.edu.my/id/eprint/2910/ |
| _version_ | 1848802668105957376 |
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| author | Malik, Amina Butt, Babar Zaheer Ud Din, Shahab Aziz, Haroon |
| author_facet | Malik, Amina Butt, Babar Zaheer Ud Din, Shahab Aziz, Haroon |
| author_sort | Malik, Amina |
| building | UiTM Institutional Repository |
| collection | Online Access |
| description | This study examined the effectiveness of regulatory capital in enhancing efficiency and credit growth and reducing bad loans in commercial banks listed on the Pakistan Stock Exchange (PSX) from 2010 to 2019. Precisely, the impact of capital adequacy ratio (CAR) was studied on net interest margin (NIM), credit growth (CR) and non-performing loans (NPLs). The impact of capital adequacy regulations was assessed by retrieving data from financial statements analysis (FSA), Bank Financial statements and the World Bank website. Panel regression models including ordinary least squares (OLS), fixed and random effects under robust title were applied in this study. Results revealed that the implementation of stringent CAR plays the role of panacea and increases interest margin & credit growth and a reduction of NPL in Pakistani commercial banks. The study provides practical results for regulators to customize regulations on credit growth to reduce non-performing loans and maintain healthy growth of loans by not compromising on interest margins as well as maintenance of minimum capital adequacy ratios. With the high significance of stringent minimum capital adequacy for banks, the findings of the study are valuable for regulators, banks, auditors and investors, as capital adequacy ratio commonly plays the role of Panacea in terms of efficiency, credit growth and reduction in non-performing loans. |
| first_indexed | 2025-11-14T21:27:00Z |
| format | Article |
| id | uitm-2910 |
| institution | Universiti Teknologi MARA |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-14T21:27:00Z |
| publishDate | 2021 |
| publisher | Universiti Teknologi MARA |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | uitm-29102022-07-05T07:25:29Z https://ir.uitm.edu.my/id/eprint/2910/ Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.] apmaj Malik, Amina Butt, Babar Zaheer Ud Din, Shahab Aziz, Haroon Accounting. Bookkeeping Banking This study examined the effectiveness of regulatory capital in enhancing efficiency and credit growth and reducing bad loans in commercial banks listed on the Pakistan Stock Exchange (PSX) from 2010 to 2019. Precisely, the impact of capital adequacy ratio (CAR) was studied on net interest margin (NIM), credit growth (CR) and non-performing loans (NPLs). The impact of capital adequacy regulations was assessed by retrieving data from financial statements analysis (FSA), Bank Financial statements and the World Bank website. Panel regression models including ordinary least squares (OLS), fixed and random effects under robust title were applied in this study. Results revealed that the implementation of stringent CAR plays the role of panacea and increases interest margin & credit growth and a reduction of NPL in Pakistani commercial banks. The study provides practical results for regulators to customize regulations on credit growth to reduce non-performing loans and maintain healthy growth of loans by not compromising on interest margins as well as maintenance of minimum capital adequacy ratios. With the high significance of stringent minimum capital adequacy for banks, the findings of the study are valuable for regulators, banks, auditors and investors, as capital adequacy ratio commonly plays the role of Panacea in terms of efficiency, credit growth and reduction in non-performing loans. Universiti Teknologi MARA 2021-08 Article PeerReviewed text en https://ir.uitm.edu.my/id/eprint/2910/1/2910.pdf Malik, Amina and Butt, Babar Zaheer and Ud Din, Shahab and Aziz, Haroon (2021) Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.]. (2021) Asia-Pacific Management Accounting Journal (APMAJ) <https://ir.uitm.edu.my/view/publication/Asia-Pacific_Management_Accounting_Journal_=28APMAJ=29.html>, 16 (2): 23. pp. 265-287. ISSN (eISSN):2550-1631 https://apmaj.uitm.edu.m/ |
| spellingShingle | Accounting. Bookkeeping Banking Malik, Amina Butt, Babar Zaheer Ud Din, Shahab Aziz, Haroon Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.] |
| title | Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.] |
| title_full | Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.] |
| title_fullStr | Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.] |
| title_full_unstemmed | Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.] |
| title_short | Regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / Amina Malik …[et al.] |
| title_sort | regulatory capital is a panacea for efficiency, credit growth and reducing non-performing loans in commercial banks / amina malik …[et al.] |
| topic | Accounting. Bookkeeping Banking |
| url | https://ir.uitm.edu.my/id/eprint/2910/ https://ir.uitm.edu.my/id/eprint/2910/ |