THE EFFECT OF INTERNAL VARIABLES ON PROFITABILITY OF COMMERCIAL BANKS OF PAKISTAN

Abstract

Purpose The motive behind this study was to determine the relation of independent variables with the dependent variables. Moreover, to define the level of effectiveness of the independent variables on the dependent variables. The dependent variable in this research study is the profitability indicator of the commercial banks in Pakistan, ROA return on asset. The independent variables have been selected after reviewing several amounts of literature. The independent variables are equity to assets ETA, debt to assets DTA, deposits to assets DEPTA, and bank size BS and asset management AM. Data Collection Conventional banks in Pakistan are considered as a population. The findings will represent the bank Pakistan's Commercial banks5 Profitability. Data were in Pakistan. The data specific determinants that may have an impact collected for the years 2010 to 2020, based on the sample size ofCommercial banks compiled using secondary resources, that is, financial statement data from all selected . These fiscal statements/reports data have been collected from the annual on in this study were Commercial banks in Pakistan financial statement analysis data ofthe financial sectors ofthe State Bank of Pakistan. The website ofthe used to collect the data, ranging from 2010 to 2020. This is the panel showing the trend ofthe financial statements ofthe selected Investment banks State Bank of Pakistan has also been data consisting of 10 years ofPakistan. Findings The results show that the Bank Slae has , positive moderate ieve, of cere,a,ion with the dependent ROA. Asset Management has a positive but weak level relation with the Assets ROA. Whereas, the Equity to Assets, Debt to Assets, and on Assets on the variable return on assets profitability which is Return on indicator Deposits to assets have a negative and weak cortelation with the profitability indicator Return assets and asset management have a significant and positive impact Whereas, the size ofthe banks has no significant ROA. Moreover, deposits to dicator which is the return on assets ROA indicator ROA of the profitability in influence on the profitability commercial banks. The other remaining two on the and debt to assets has a significant but negative impact to assets assets ROA.