Exploring the nexus between bank age, size, risks and profitability: an empirical study of Indian private banks

Preeti Dua

International Journal of Business Continuity and Risk Management, 2025, vol. 15, issue 4, 341-372

Abstract: The purpose of this study is to investigate the relationship between bank profitability, risks, size, and age. The study first looks at how age and size affect profitability, and then it looks at how profitability affects bank risks. The data were gathered from Prowess database of CMIE for all the variables of 19 private sector banks over 14 fiscal years, from 2009-2010 to 2022-2023. The study found that age and size had distinct direct effects on various risk types, with size alone causing significant effects on operational risk (OPR), credit risk (CDR), liquidity risk (LQR), interest rate risk, (IRR) and compliance and regulatory risk (CRR). Profitability was also significantly influenced by age and size, but as a mediator, it only affected interest rate risk, (IRR), credit risk (CDR), and compliance and regulatory risks (CRR). The total joint effect was significant on all risks excepting operational risk (OPR).

Keywords: internal control; bank age; bank size; profitability; private banks; bank risks; India. (search for similar items in EconPapers)
Date: 2025
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