Joint Venture Banks Research Articles

A comparative study on the impact of service quality on customer satisfaction: Survey of joint venture and government banks in Nepal

This study explores the relationship between customer satisfaction and service quality, of the inquiry is the evaluation of client satisfaction regarding the caliber of service rendered by Nepalese commercial banks. The study attempts to determine the effect of focusing on how important it is for service quality to influence customer contentment. The primary focus service quality on customer satisfaction within the Nepalese banking industry is by using descriptive and causal comparative research techniques. A total of 383 samples were taken from six joint venture banks and three public (or Government ownership) banks in Nepal. Using primary data obtained from a survey with a five-point Likert scale, correlation and regression analysis are used in the study to examine the impact of several service quality parameters on customer satisfaction. The results show that, in the Nepalese banking industry, responsiveness, reliability, assurance, and empathy have a positive and significant association with customer satisfaction. However, responsiveness does not significantly affect customer satisfaction.

Elasticity of Investment Financing Policy towards the Growth of Film Distribution Networks as an Effort to Redesign the Film Industry

This research aims to analyze the influence of investment financing policies on the growth of film distribution networks. Investment financing policy is seen from the aspect of setting investment credit interest rates in banking. Meanwhile, the growth of the film distribution network can be seen from the aspect of the number of cinema screens in Indonesia. This research uses several variables, such as: Investment Credit Interest Rates at Bank Persero, Regional Development Banks, National Private Banks and Foreign and Joint Venture Banks. The time range used in this research is from 2014 – 2022. This research uses quantitative methods using multiple linear regression. The explanation of the analysis results uses Keynes and Schumpeter’s theoretical approach. Based on the results of data analysis, it was concluded that the investment credit interest rate variable had a significant negative effect on the variable number of cinema screens, especially on the National Private Bank Investment Credit Interest Rate. The results of the coefficient of determination (adjusted R2) show that the influence of the number of cinema screens is 0.9492175. The higher the interest rate on investment credit, the lower the number of cinema screens.

The Balanced Scorecard Approach with Customer Dimension

This study aims to evaluate the customer dimension of the balanced scorecard approach in the banking industry of Nepal and to compare the state of the balanced scorecard from the customer dimension in state-owned banks, private banks, and joint-venture banks. It employs a descriptive method of study. A questionnaire survey is used to collect data for this study. The results show that the top five elements of the customer dimension of the balancing scorecard technique are believed to be customer retention, brand image, minimum customer complaints, careful staff to provide service and customer acquisition. The important factors that follow them include sufficient staff to provide services to customers, best appearance and friendliness of staff, customer profitability, distinctive product/service attributes, increasing market share, offering social/community services, in-time customer services, satisfied customers, and skillful and competent staff. However, market penetration success is thought to be the least important factor in the customer dimension of the balanced scorecard. Therefore, to be successful, today’s financial institutions must gather information from customers, use it to create a plan that will fulfill their demands, and then put that strategy into action by being receptive to their needs and desires.

Comparative Analysis of Credit Risk Management Practices: A Study of Domestic and Joint Venture Commercial Banks in Nepal

The capital adequacy ratio, credit to deposit ratio, bank size, leverage ratio, loan loss provision, and non-performing loans were assessed for determining the relationships within domestic and joint venture commercial banks in Nepal. Using secondary data from 10 commercial banks spanning 2006/09 to 2019/20, totaling 140 observations, the study employs descriptive and regression analyses. Data sources include NRB's Banking and Financial Statistics, annual supervision reports, and selected banks' annual reports. HBL has the highest average non-performing loan (2.56%), while NIC Asia has the lowest (0.23%). SCBL exhibits the highest average capital adequacy ratio (15.92%), and SBL leads in credit to deposit ratio (86.85%). EBL tops in bank size (Rs 85,327 million), and MBL in leverage ratio (19.39%). HBL records the highest loan loss provision ratio (1.49%), with NBL at the lowest (0.32%). Descriptive statistics reveal the mean non-performing loan for domestic banks (1.12%), joint venture banks (1.22%), and overall banks (1.17%). The correlation analysis indicates negative correlations between capital adequacy ratio, bank size, credit to deposit ratio, leverage ratio, and loan loss provision with non-performing loans. Regression results underscore the significance of leverage ratio and loan loss provision in impacting non-performing loans for overall banks, while domestic banks find significance only in loan loss provision. Joint venture banks show significance in leverage ratio and loan loss provision. Keywords: Credit risk, Commercial banks, Nepalese banking sector, Leverage ratio, Loan loss provision, Capital adequacy ratio, Descriptive analysis, Regression analysis.

Impact of Bank-specific and Macroeconomic Factors on Non-Performing Loans in the Banking Sector of Nepal

Non-performing loans (NPLs) in the banking sector serve as a crucial indicator for assessing the performance of banks, as the effective management of credit risk stands as a pivotal challenge for lending institutions. The study aimed to determine the significant determinants of bank-specific factors including bank types and macroeconomic factors that determine the magnitude of NPLs in the context of Nepal. The study has included 11 years of strongly balanced panel data of 16 commercial banks consisting of seven domestic private banks, six joint venture banks, and three government-owned banks and macroeconomic data for the period of 2011/12 to 2021/22. The study applied the Pool OLS regression model including bank-dummy variables to assess the impact of the bank-specific factors and macroeconomic factors. The results revealed that the non-performing loan is higher in government-owned banks with a high level of variability compared to domestic private banks and joint venture banks. The study concluded that capital adequacy (CAR), operating efficiency (OCR) and remittance (Remit) have a significant negative impact on NPLs whereas, credit mobilization (CDR) has a significant positive impact on NPLs. It also revealed that the presence of joint venture and domestic private sector banks significantly decreased the size of non-performing loans compared to the presence of government-owned banks in the banking industry. Moreover, ROA, the rate of inflation, and lending interest rates have a positive but insignificant effect on NPLs. Similarly, the GDP growth rate has a negative but insignificant effect on NPLs.

Corporate Governance and Performance of Commercial Banks in Nepal

The purpose of this study was to examine the effect of corporate governance on performance of commercial banks in. It also examined the corporate governance practices of commercial banks. The study followed quantitative approach and descriptive research design. Multiple regression analysis was used to explore the causal relationship between corporate governance and financial performance of commercial banks. The study revealed a positive relationship of number of board meeting and foreign ownership and bank performance which shows higher the board meeting, foreign investment higher would be the bank performance. However, there was negative relationship of board size and capital adequacy ratio with bank performance indicating higher the board size, capital adequacy ratio would lead lower bank performance. Practices of corporate governance system of financial sector in Nepal is still infant stage however joint venture banks practices are more harmonizing rather than government banks and other banks.

Non-Performing Assets and Profitability of Joint Venture Banks in Nepal

This study examines the impact of non-performing assets and profitability of commercial banks in Nepal. Out of 27 commercial banks, five joint venture banks have been selected as sample based on descriptive and analytical technique. Secondary data was collected from the annual reports of five selected commercial banks for the period of 2011/12 to 2020/21. Data have been collected and analyzed by using mean, standard deviation, and correlation and regression analysis. The profitability in terms of return on assets (ROA), return on equity (ROE) and profitability are selected as dependent variables. Non- performing assets (NPA), capital adequacy ratio (CAR) and total loan to total deposit ratio (TLTD) are taken as independent variables. The finding indicates that NPA has significant impact on the profitability of Nepalese joint venture banks. The result shows that ROE has been found a positive impact on the NPA, CAR and TLTD. Thus, this study concludes that non-performing assets is an important predictor for the profitability of the bank. Therefore, the success of the bank in term of profitability depends on its non-performing assets.

The Liquidity Management and Profitability of Joint Venture Banks in Nepal

The main objective of this study is to establish a connection between liquidity management and the effect of profitability of joint venture banks in Nepal. We observed the data from Nepal's top five joint venture banks over ten years, from 2012 to 2021. We used financial statements to collect information. In our analysis, we used different indicators like the current ratio (CR), loan-to-total deposit (LTD), capital-to-asset ratio (CAR), and non-performing loans (NPL) as measures of liquidity. We treated these as independent variables and Return on assets (ROA) as dependent variable. Our findings show the positive link between ROA and CR, meaning higher CR is connected to greater ROA. However, the study reveals an unfavorable relationship between NPL and ROA, suggesting higher NPL leads to lower ROA. As a result, our research advises banks to keep liquidity only as long as necessary for specific liabilities, avoiding unnecessary holding of liquidity, which could reduce profitability.

Credit Risk and Profitability Position of Nepalese Private and Joint Venture Commercial Banks

Credit concentrations, credit processes and other externalities have made credit risk more important over the past decade, followed by liquidity issues. This study was conducted to compare the credit risk exposure of various banks in terms of their liquidity, capital ratio, size, operational inefficiency, loan growth rate, and non-performing loans. It also investigated the spontaneous relationship between credit risk and bank profitability. Secondary data of 5 years from ten banks (5 each from joint venture and private banks) have been collected. The descriptive and comparative study designs were employed and SPSS software was used for the analysis of data. The results showed that the private banks surpass joint venture banks in terms of capital ratio and operating efficiency, but joint venture banks lead private banks in terms of liquidity, capital ratio, total assets, loan growth rate, and non-performing loans. However, the independent sample t-test did not show any significant differences on liquidity, capital ratio, size, and loan growth rate. The Pearson’s correlation showed positive associations of capital ratio (moderate and significant), operating inefficiency (weak and insignificant), and loan growth rate (weak and insignificant) with ROA. In contrast, bank size and nonperforming loans have significant moderate negative correlations, but liquidity is not found to be correlated with ROA. The empirical findings of this study are considered helpful in evaluating the comparative credit risk exposure of the banking sector and have both managerial and academic implications.

Existence of Joint Venture Banks and their Impacts on the Performance of Non-Joint Venture Commercial Banks in Nepal

This paper aims to examine the effect of the existence of joint venture (JV) banks on the performance of non-joint venture (NJV) commercial banks of Nepal. The study is based on secondary data, where the data have been collected from fourteen sampled banks' annual reports, Ministry of Finance publications, and World Bank publications. Seven years of data from Fiscal Year 2013/14 to 2019/20 of cross-section units (banks) established before 2008 have been taken for the study. Descriptive analysis, correlation, and regression have been used in the study. The result depicts that JV banks’ existence in Nepal significantly impacts return on assets and credit risk levels but does not show an impact on the net interest margin (NIM) of NJV commercial banks. The regression result shows that loan deposit ratio, capital adequacy ratio (CAR), bank’s equity level, and non-performing loan (NPL) of JV banks substantially impact the NIM of NJV banks. Likewise, the interest spread rate and NPL of JV banks significantly affect the ROA of NJV commercial banks. Similarly, interest spread, CAR, and foreign ownership ratio significantly impact the credit risk level of NJV commercial banks in Nepal. Likewise, the result further shows that JV banks have been earning relatively higher non-interest income, which positively reflected on the ROA of banks. Additionally, JV banks have been booking low-quality credit portfolios at a lower interest rate.

FACTORS AFFECTING THE SHARE PRICE OF NEPALESE JOINT VENTURES COMMERCIAL BANKS

The study intended to examine the factors affecting the share price of Nepalese joint ventures commercial banks. Market price per share is selected as dependent variable while earning per share, price earnings ratio, book value per share, return on assets and size were chosen as firm specific independent variables. In order to fulfill these objectives the data were collected from the banking and financial statistics and annual report published by Nepal Rastra Bank and annual report of selected banks which is based on panel data over 11 years of period from 2012 to 2022 of selected five commercial joint venture banks of Nepal.The Descriptive and casual relationship research design has been used using secondary data. The multiple regression models were estimated to test impact of firm specific factors on share price of Nepalese joint venture commercial banks, results shows that variables like earnings per share, price earnings ratio, book value per share and return on assets are the major determining stock price having significant impact on price of share except size of firm having insignificant impact in context of joint venture commercial banks of Nepal. Keywords: Joint venture, Share Price, Panel Data,

Evaluating Nepalese Commercial Banks’ Performance from the Eyes of EAGLES Rating

The paper aimed to evaluate the performance of the Nepalese commercial banks using the EAGLE rating model developed by Vong (1994) based on the bank's earning ability ratio, assets quality ratio, growth rate, liquidity, and equity to which an acronym as EAGLE. Vong and Song (2015) added the 'S' element afterward under EAGLE, renaming EAGLES. The strategy response quotient (S) shows management's capacity to set deposit and loan rates and to control a bank's interest burden, calculated as non-interest income minus any overhead costs. The paper considered the financial information of all the commercial banks operating in Nepal from 2018-19 to 2020-21. The paper found that the banks with a short history in the Nepalese banking industry with aggressive market expansion were at the top of the position under the EAGLES rating. The paper also found that ranking for return on equity (E) and ranking for non-performing loan ratio (A) and ranking for return on equity (E), and ranking for capital adequacy ratio (E) have a significant relationship while determining the ranking of the commercial banks. Similarly, the paper found that the bank with a better position for all the components of EAGLES was at the top for the government-owned commercial banks, while for joint venture banks, the bank with better loan growth, liquidity position, and capital structure was at the top.

Impact of Bank-Specific Variables on Financial Performance of Joint Venture Banks in Nepal

Banks play an important role not only in the growth of the financial system but also in the development of the overall economy of a nation. Therefore, the determinants of bank performance have attracted the interest of academic research, bank management, and financial markets as well as of bank regulatory bodies. This paper examines the impact of bank-specific variables on the financial performance of joint venture banks in Nepal. The data are collected from the supervision report of Nepal Rastra Bank and annual reports of the sample banks for 10 years from the fiscal year 2009/10 to 2018/19. Based on the results of the Breusch-Pagan LM test and Hausman Test, fixed effects regression models are applied to examine the effects of bank-specific variables on the financial performance of Nepalese joint venture banks. The result shows that there is a significant positive impact of size and employee expenses on the performance of banks measured in terms of return on assets, return on equity and net interest margin. Management efficiency has also a positive impact on the performance of banks but it is significant only on net interest margin. Similarly, there is a significant negative impact of liquidity on return on equity and net interest margin and a significant negative impact of operating expenses on the net interest margin of the banks.

Determinate of Lending Behavior of Joint Venture Banks in Nepal

The purpose of this research is to examine the lending behavior of Joint venture banks in Nepal. The independent factors in this study are AQR, CAR, ROA, CRR, BS, GDP, and inflation rate, and dependent variable in this research is TL.The secondary data was used from the annual reports of all joint venture banks throughout a five-year period, from 2017 to 2021. Using SPSS 25 version, descriptive as well as causal-comparative research designs have been useful to analyze and interpret this data. For the sample, all seven Joint Venture banks are utilized. It is best to employ the purposive sampling technique. It has been demonstrated how independent variables affect the dependent variable using multiple linear regression models. The findings indicate that CRR and BS have considerable positive effects on TL and significant favorable effects but CAR has negative and significant effect on TL. The effects of AQR, ROA, GDP, and inflation on TL are negligible. Similarly, AQR, CAR, and inflation have been negatively related to TL but ROA, CRR, BS, and GDP have been positively related to lending.

Evaluation of financial strength of joint venture commercial banks and domestic commercial banks in nepal: using camels framework

This study aims to compare the financial strength of joint venture and domestic commercial banks in Nepal using data from mid-July 2011/2012 to mid-July 2019/2020. The financial strength analysis is based on the CAMELS (capital adequacy, asset quality, management quality, earning performance, liquidity, and sensitivity to market risk) framework. A descriptive research design has been used. This paper finds that Nepalese joint venture banks are financially sound with higher asset quality, management quality, earning performance, and liquidity than Nepalese domestic banks. Nepalese joint venture banks can cash in on higher IT infrastructure or better investment culture from its foreign collaboration and thus perform better compared to domestic commercial banks.

Evaluation of Merchant Banking and Financial Services using VIKOR Method

Commercial banking is a professional service offered by commercial banks to customers for adequate consideration to make payments for their financial needs. Commercial banks are banks that raise funds, provide financial advice and lend to large corporations. These banks are experts in international trade and are experts in dealing with large companies and industries. Commercial banking provides finance to multinational businesses and large commercial enterprises in the country, which helps in boosting the economic strength of the country. Commercial banks do not provide services to the general public; Their services are limited to commercial companies and large business enterprises. A merchant banker fa-cilitates the subscription of securities. A commercial banker plays an important role and undertakes many responsibilities such as private placement of securities, management of public issue of securities, stock broking, and international financial advisory services. A commercial bank is a type of financial institution that offers underwriting, credit services, financial advice services, and fundraising to high-net-worth individuals and large corporations (HWNIs). Commercial banks are transnational organizations with a focus on global trade and service delivery. The VIKOR (VIšekriterijumsko Kompro-misno Rangiranje) Optimal replacement Select method is used in Australia/New Zealand, Continental, Europe, UK, Japan, Singapore, United States. Alternative: Australia/New Zealand, Continental, Europe, UK, Japan, Singapore, United States. Evaluation parameters of Area of manufacturing: Number of Partners, Number of Partners Bank Years, Share of joint venture banks assets, Average ownership per partner. Results: Australiar/New Zealand is got the first rank whereas is the Singapore is having the Lowest rank.

Effects of Government's Policy in Stock Price: A Case of Nepse

The purpose of this study is to find out the relationship of government's policy on the price movement of Nepal stock exchange (NEPSE). This study followed a case study research design, because it offers a deeper perspective and clearer understanding of the stock price movement of Nepalese joint venture banks. The sample size of this study consists of five joint venture commercial Banks, economic analysis and survey reports conducted by central bank of Nepal (Nepal Rastra Bank).The judgmental sampling method has been applied for selection of joint venture banks. The study was totally based on secondary data. in order to make proper analysis descriptive and inferential statistics were used using SPSS software version 26. The finding of this study revealed that the GDP and import are inversely associated with stock price movement and CRR, export, interest rate and inflation are positively associated with stock price movement. Further, it is found that the macroeconomic variables are key factors to determine the Nepalese stock price movement. More importantly, stock market has been found to respond significantly to changes in the government policy. It is recommended that CRR, EXPORT, INTEREST RATE and INFLATION are major factors which largely affect the stock price movement of NEPSE. GDP and IMPORT are not compliance with the stock price movement as they produce negative association with the stocks volatility.

Impact of Corporate Governance on Social Information Disclosure

Information disclosure is an integral to corporate governance, i.e., an important element of corporate governance, since higher disclosure could be able to reduce the information asymmetry, to clarify the conflict of interests between the shareholders and the management, and to make corporate insiders accountable. The study has utilized primary data. In order to collect the primary data, 150 questionnaires were distributed to the customers of 16 Nepalese commercial banks that include private banks, joint venture banks and public banks. The study includes eight non joint venture banks, six joint venture banks and two public banks. The opinion survey reveals that the most of the respondents are convinced about effective corporate governance is linked towards the better level of social information disclosure. The majority of respondents have highlighted that CEO and Chairman must be different for high level of social information disclosure.

Influnce of Corporate Governance on Financial Health of Nepalese Commercial Banks

This study aims to measure the impact of corporate governance on financial health of commercial banks in Nepal. Return on assets, return on equity and earnings per share are the dependent variables used to measure financial health and corporate governance variables such as board size, audit committee size, audit committee meetings and board diligence are considered as independent variables. Primary and secondary data were collected through the administration of structured questionnaire and from the annual reports of commercial banks respectively. Convenience sampling was used to select the commercial banks located in Pokhara valley for collecting primary data. Simple random sampling was used to select 10 commercial banks (5 joint venture and 5 non joint venture banks) out of total population of 27 commercial banks for a time period of 2017/18 to 2019/20 for collecting secondary data. Multiple regression analysis and descriptive statistics were used in analyzing the data. Independent sample t-test was used to test the hypothesis in order to find out the relationship between corporate governance and financial performance. The questionnaire survey reveals that board independence and audit committee independence are the most important variable for corporate governance. The primary data analysis concluded that small size board enhances the financial health. Transparency and disclosure is also an important feature of audit committee mechanisms. The analysis of secondary data reveals that audit committee meetings has a significant but inverse relationship with health of the commercial banks. The result indicates that priority should be given for quality of meetings but not the number of times such meetings are held due to the busyness of directors having better knowledge, expertise and their involvement in different sectors. The results support the idea that board busyness is useful factor for director quality. And busyness needs to be integrated with diligence to the extent that busy directors are diligent towards firms and they are able to exercise their expertise to positively influence firm performance. This study also helps the future researchers to conduct future research on impact of corporate governance on financial health to extend with new data and huge sample.

Rhetorical Culture and Brand Slogan: An Analysis of the Slogans of all Commercial Banks from Nepal

Rhetoric is the artful deviation of information and ideas. It is commonly utilized in different forms of advertising. In this context, the study has examined how rhetorical devices are employed in the brand slogans of the 28 commercial banks in Nepal. To achieve their dominant theme there, it identifies and categorizes the devices following the taxonomy developed by James H. Leigh. The framework divides such figures of speech into 41 types under 2 major categories schemes and tropes. The finding from this descriptive analysis and has indicated that music, memory, association, emphasis, emotion and exaggeration are some popular constructs for designing the slogans. Moreover, Nepali private commercial banks seem more successful in utilizing such strategies as they have applied maximum rhetorical devices in comparison to foreign joint -venture and governmental banks. In this trajectory, foreign joint-venture banks have an international brand in the name itself, governmental banks can communicate with customers being people's banks and private banks appear smart in incorporating maximum wordplays in the slogans to play with the sentiment of the audience influencing them. The study simultaneously contributes to both the fields of creative writing and marketing communication literary world and marketing sector updating the current awareness about rhetorical culture. The study has only included the slogans of commercial banks from Nepal, but the comparative study between the slogans of all the banks from Nepal and the banks' slogans from other countries may reflect a clearer picture regarding rhetorical culture.