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Determinants of Lending Interest Rates of Nepalese Commercial Banks
Economic Journal of Development Issues
View Archive Info| Field | Value | |
| Title |
Determinants of Lending Interest Rates of Nepalese Commercial Banks
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| Creator |
Bhattarai, Yuga Raj; Patan Multiple Campus, Tribhuvan University
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| Subject |
Economics
Bank; Lending interest rates; Deposit rate; Return on assets; Credit risk |
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| Description |
The aim of this study is to investigate the determinants of lending rate of Nepalese commercial banks. The analysis of data was based on a sample of 6 commercial banks observed over the period 6 years (2010 to 2015). The models used in the study were: pooled OLS model, fixed effects model and random effects model. This study has used ‘lending rate’ as dependent variable, while the explanatory variables are: operating cost to total assets ratio, deposit interest rate, profitability (ROA) and default risk. The estimated results of these three regression models reveal that operating costs to total assets ratio, profitability (ROA) and default risk have significant positive impact on the commercial bank lending rate. However, deposit rate has negligible impact on lending interest rate. Thus, this study concludes that the major determinants of commercial banks’ lending rate are: operating costs to total assets ratio, profitability (ROA) and default risk in Nepalese perspectives.Economic Journal of Development Issues Vol. 19 & 20 No. 1-2 (2015) Combined Issue, Page: 39-59
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| Publisher |
Department of Economics Patan Multiple Campus
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| Contributor |
—
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| Date |
2017-07-07
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| Type |
info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion Peer-Reviewed Article — |
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| Format |
application/pdf
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| Identifier |
http://www.nepjol.info/index.php/EJDI/article/view/17701
10.3126/ejdi.v19i1-2.17701 |
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| Source |
Economic Journal of Development Issues; Vol 19 & 20 (2015); 39-59
2091-2285 2091-055X |
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| Language |
eng
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| Relation |
http://www.nepjol.info/index.php/EJDI/article/view/17701/14370
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| Coverage |
Nepal
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| Rights |
Copyright (c) 2017 Economic Journal of Development Issues
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