Internal Determinants of Banking Soundness: The Case of Egypt

Nader Alber and Salma Aboualsoud ()
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Nader Alber: Ain Shams University
Salma Aboualsoud: Ain Shams University

A chapter in Transformational Trends in Finance, Banking, and Economics, 2025, pp 17-45 from Springer

Abstract: Abstract This chapter attempts to investigate the relationship between banking internal factors and financial performance. The internal factors refer to the unique characteristics of a bank that have a direct impact on its performance. These factors are under the control of banks management and can differ from one bank to another. While many studies concentrate on external factors, this research aims to shed light on the significance of these internal factors in determining the success or failure of banks in Egypt. The research sample consists of 12 banks listed on the Egyptian exchange over the period of 2005–2020. Banking soundness has been measured according to the CAMELS approach, by capital adequacy, asset quality, management quality, earning efficiency, liquidity risk, and sensitivity to market risk. Internal determinants to be examined include bank age, bank size, number of branches, the board size, the presence of nonexecutive directors, number of females on the board, CEO duality, board meetings, auditing committee meetings, and board of directors’ ownership. Using panel data analysis according to the generalized method of moment (GMM) technique, the results show significant effects of banks’ internal factors on financial performance.

Keywords: Bank-specific factors; CAMELS; GMM technique; Panel analysis (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-3-031-81532-4_2

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DOI: 10.1007/978-3-031-81532-4_2

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