Assessing the Performance of Commercial and Specialized Banks in Iran, Focusing on the Effect of Interbank Interest Rates

Document Type : Scientific paper

Authors

1 faculty of Economics. Payame Noor University

2 Faculty of Economics, Allameh Tabatabai University

3 Professor, Department of Economy, Payame Noor University, Tehran, Iran,

4 Ph.D. Candidate in Islamic Economics, Payame Noor University

Abstract

The main purpose of this study was to analyze the state of the banking system in terms of the main influencing factors, specifically the interbank interest rate on the profitability of commercial and specialized banks. To do this, the research followed the descriptive-analytical method and used library methods and the databases of the Securities and Exchange Organization and the Time Series Bank of the Central Bank of the Islamic Republic of Iran to collect the required data. The statistical sample of this research consisted of 17 commercial and specialized public and private banks.  The econometric methodology of estimating the model of simultaneous equations was used to analyze the data. According to the research findings, the interbank interest rate has a direct and negative effect, and the coefficients obtained from the model estimation are significant. It is worth mentioning that factors such as bank size, bank concentration index, and ownership ratio also significantly affect the profitability of commercial and specialized banks under study. Moreover, the results showed that macroeconomic variables such as annual inflation rate and economic growth rate have a negligible effect on the exogenous variables of the model.

Keywords

Main Subjects

References

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Macroeconomics Research Letter
Volume 18, Issue 39
December 2023
Pages 135-164

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History

  • Receive Date: 11 December 2023
  • Revise Date: 16 January 2024
  • Accept Date: 17 January 2024

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