Net Interest Marginof Commercial Banks in Vietnam

Nguyen Duy Suu, Thu-Quang Luu, Kim-Hung Pho and Michael McAleer
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Nguyen Duy Suu: Faculty of Finance and Banking, Ton Duc Thang University, Ho Chi Minh City, Vietnam
Thu-Quang Luu: Faculty of Finance and Banking, Ton Duc Thang University, Ho Chi Minh City, Vietnam
Kim-Hung Pho: Faculty of Mathematics and Statistics, Ton Duc Thang University, Ho Chi Minh City, Vietnam

Advances in Decision Sciences, 2020, vol. 24, issue 1, 1-27

Abstract: The paper investigates the factors that affect the net interest margin (NIM) of commercial banks (CBs) in Vietnam between 2008 and 2018. We examine secondary data of CBs with 308 observations during the period 2008-2018, and apply a range of investigative methods to confirm the empirical findings. The results show that operating expenses and credit risk have a positive impact on NIM, whereas the level of risk aversion, quality of management, income from trading, and the proportion of deposits have negative impacts on NIM. The empirical findings offer suggestions which should help bank management to identify the factors affecting the marginal interest rate to apply suitable policies in supervising CBs in Vietnam.

Keywords: Marginal rate; net interest margins; operating costs of commercial bank; market power (search for similar items in EconPapers)
JEL-codes: E42 G20 G21 O16 O53 (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:aag:wpaper:v:24:y:2020:i:1:p:1-27

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