Impact of Working Capital Management on the Profitability of Dutch Bangla Bank Limited (DBBL): A Comparative Analysis

Abstract

A financial institution must check the impact of working capital management on profitability to determine its relative position based on earnings over time. This study has been conducted to identify the period that is more realistic in terms of profitability and working capital management for Dutch Bangla Bank Limited (DBBL) from 2009 to 2014 and 2016 to 2021. A variety of Dutch Bangla Bank Limited (DBBL) annual reports serve as the only main source for the study's secondary data. In this study, return on networking capital is considered a dependent variable, and quick ratio, return on equity, and return on assets are considered independent factors. Data were evaluated using informative statistics, the T-test, correlation, and the ANOVA Test (Multiple Regression Analysis). Those test results demonstrate that return on equity has no effect and has a negligible effect on the return on net working capital from 2009 to 2014 and from 2016 to 2021, whereas the return on assets has a significant positive impact on net working capital from 2009 to 2014 and from 2016 to 2021. Additionally, the current ratio had no impact on the return on net working capital from 2009 to 2014, but it had a very beneficial impact starting in 2016 and 2021. The 2015–2021 phases had more changes in the current ratio, return on equity, and return on working capital than the 2014–2014 phases did. The 2009–2014 phases saw more strategic and careful working capital management than the 2015–2021 phases.