Abstract:
Purpose: The main puipose of the research is to determine the Best corporate financing
option for the profitability of the bank. To conduct this study the effect of Equity, Long term
obligation and Short term obligation on the Profitability, Earnings per share and Return on
Assets is analyzed.
Methodology: The target population for the research is MCB Bank Ltd. This research is
quantitative in nature. In this study secondary data is used to perform analysis. The
secondary data is collected from official website of MCB Bank Ltd. As this study is
quantitative therefore the numerical data is collected from the financial statements of one of
the commercial bank MCB Bank Ltd operating in Pakistan from the period of 2000 to 2015.
To analyze the data, Regression, ANOVA and Correlation tests were applied. The reason to
select one bank is the access to the required data and limited time of the study.
Findings: The detailed analysis of financial data of MCB Bank Ltd shows that there is not
any significant connection between' long term debt and Profit after tax; long term debt and'
earnings per share of the bank. However, Equity and short term debt have a significant
impact on profit after tax, earnings per share and return on assets of the bank.
Practical Implications: This study will not only help the commercial bank to conduct the
cost benefit analysis of their investment decision so that they can realize the maximum return
but will also help to analyze the best financing option for bank with respect to the ground
realties of Pakistan’s financial sector and economy.
