Journal of Economics and Business

ISSN 2615-3726 (Online)

ISSN 2621-5667 (Print)

Published: 14 June 2019

Impact of Capital on Profitability of Banks: Evidence from Vietnamese Commercial Banks

Do Hoai Linh, Vu Kieu Trang

National Economics University, Vietnam

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10.31014/aior.1992.02.02.94

Pages: 379-395

Keywords: Capital, Profitability, Commercial banks, Vietnam

Abstract

This study aims to investigate the impact of capital on bank profitability with evidence from Vietnamese commercial banks. With a sample of 30 Vietnamese commercial banks, the findings show the positive relationship between capital and bank profitability during the period of 2012-2018. Accordingly, the influence of capital is more pronounce in the case of small-sized banks, whereas it exerts insignificant influence on the profitability of large-sized banks. Moreover, a high degree of capital increased the profitability of private-owned banks, the impact of capital is positive and significant for the net interest margin of state-owned banks only.

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