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Published in:

Volume 5 Issue 12
December-2018
eISSN: 2349-5162

Unique Identifier

JETIRP006058

Page Number

249-256

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Title

Impact Of Customer Trust, Capital Regulation And Bank-Specific Factors On The Stability Of Banks In India

ISSN

2349-5162

Cite This Article

"Impact Of Customer Trust, Capital Regulation And Bank-Specific Factors On The Stability Of Banks In India", International Journal of Emerging Technologies and Innovative Research (www.jetir.org), ISSN:2349-5162, Vol.5, Issue 12, page no.249-256, December-2018, Available :http://www.jetir.org/papers/JETIRP006058.pdf

Abstract

The banking system plays a prominent role in the economic growth of any country. A weak banking systemendangers the long-term growth of an economy andprompts for a financial crisis that further can leadto an economic disaster.The purpose of this research study is to assess the influence of customer trust, capital regulationsand certain bank-specificfactors on the bank stability of public and private banks in India.For the purpose data collected from financial statements of 21 public and 19 private sector banks from RBI Database over a period of thirteen years in the span of 2005-2017. First financial ratios are calculated for all the banks in the specified period, then 3 years rolling mean and standard deviation of ROA is calculated to measure the Bank stability measure Z-Score. Then data truncated to four digits with the use of MS-Excel to bring the uniformity in the size of the ratios. With theuse of 11 years data, tested for stationary and performed all the CLRM assumption tests, themodel is estimated with the use of OLS fixed effect regression model which is suitable for data as per the Hausmanspecification test. The results show that capital regulation, profitability, bank size, and income structure existed significant positive effect on the bank stability measure Z-Score. The customer trust and NNPA have asignificantnegative impact on bank stability. The other independent variables of model namely management quality, liquidity and efficiency are not significant. These findings provide an understanding of the factors that are influencing bank stability and serves as a toolto improve bank stability by focusing on the negatively impacting variables.

Key Words

Bank stability, Customer trust,Income structure, Liquidity, and profitability

Cite This Article

"Impact Of Customer Trust, Capital Regulation And Bank-Specific Factors On The Stability Of Banks In India", International Journal of Emerging Technologies and Innovative Research (www.jetir.org | UGC and issn Approved), ISSN:2349-5162, Vol.5, Issue 12, page no. pp249-256, December-2018, Available at : http://www.jetir.org/papers/JETIRP006058.pdf

Publication Details

Published Paper ID: JETIRP006058
Registration ID: 192694
Published In: Volume 5 | Issue 12 | Year December-2018
DOI (Digital Object Identifier):
Page No: 249-256
ISSN Number: 2349-5162

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Cite This Article

"Impact Of Customer Trust, Capital Regulation And Bank-Specific Factors On The Stability Of Banks In India", International Journal of Emerging Technologies and Innovative Research (www.jetir.org | UGC and issn Approved), ISSN:2349-5162, Vol.5, Issue 12, page no. pp249-256, December-2018, Available at : http://www.jetir.org/papers/JETIRP006058.pdf




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