From: Do competition and efficiency lead to bank stability? Evidence from Bangladesh
Variables | \(\sigma {\text{ROA}}\) | NPL | ||||
---|---|---|---|---|---|---|
(1) | (2) | (3) | (4) | (5) | (6) | |
\({\text{Financial stability}}_{t - 1}\). | 0.553*** (0.019) | 0.585*** (0.024) | 0.596*** (0.033) | 0.499*** (0.021) | 0.507*** (0.022) | 0.483*** (0.032) |
\({\text{Competition }}_{t - 1}\). | − 0.071*** (0.009) | − 0.066*** (0.009) | − 0.098*** (0.016) | − 10.082*** (0.635) | − 9.850*** (0.623) | − 8.410*** (0.637) |
\({\text{Competition }}_{t - 1}^{2}\) | 0.074*** (0.009) | 0.069*** (0.009) | 0.095*** (0.014) | 1.360*** (0.087) | 1.328*** (0.084) | 1.222*** (0.095) |
Efficiency | − 0.006** (0.002) | − 0.008* (0.004) | − 0.169*** (0.063) | − 3.213*** (1.033) | ||
\({\text{Competition}}_{t - 1} {{ \times Efficiency}}\) | 0.007** (0.003) | 0.933*** (0.284) | ||||
Bank size | − 0.000 (0.000) | − 0.000 (0.000) | − 0.001* (0.001) | − 0.059*** (0.005) | − 0.038*** (.007) | − 0.034*** (0.010) |
Liquidity | − 0.001*** (0.000) | − 0.000 (0.001) | − 0.000 (0.001) | − 0.000 (0.002) | − 0.005* (0.003) | − 0.009** (0.005) |
Log(GDP per capita) | − 0.001** (0.000) | − 0.001 (0.001) | − 0.001 (0.001) | − 0.108*** (0.007) | − 0.126*** (.010) | − 0.134*** (0.011) |
gGDP | 0.002*** (0.000) | 0.002*** (0.000) | 0.002*** (0.000) | − 0.002 (0.002) | − 0.002 (0.002) | − 0.004* (0.002) |
Governance | − 0.001*** (0.000) | − 0.003** (0.001) | − 0.003** (0.001) | − 0.187*** (0.013) | − 0.200*** (0.013) | − 0.210*** (0.013) |
Regulation | − 0.000** (0.000) | − 0.001*** (0.000) | − 0.001*** (0.000) | − 0.005*** (0.002) | − 0.006*** (0.001) | − 0.002 (0.001) |
Constant | 0.002*** (0.000) | 0.004 (0.004) | 0.007 (0.005) | 18.541*** (1.152) | 18.241*** (1.124) | 14.410*** (1.189) |
Year dummies | Yes | Yes | Yes | Yes | Yes | Yes |
No. of instruments | 28 | 28 | 28 | 29 | 29 | 29 |
AR (2) | 0.24 | 0.13 | 0.18 | 0.19 | 0.18 | 0.19 |
Hansen statistics | 0.22 | 0.12 | 0.11 | 0.11 | 0.12 | 0.11 |
Observations | 210 | 210 | 210 | 240 | 240 | 240 |
No. of banks | 30 | 30 | 30 | 30 | 30 | 30 |