Business Administration in Finance

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Browsing Business Administration in Finance by Author "Abebaw Kassie"

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    Bank Specific Determinants of Non-Perfoming Loans in the Case of Ethiopian Private Commercial Banks
    (A.A.U, 2021-06-13) Sawit Wassie; Abebaw Kassie
    This study aims to find out the determinants of NPLs in Ethiopian private commercial banks. The variables were picked based on findings from the past written literatures. A quantitative research approach and explanatory research design were taken on in completing this research. Data collection method adopted for the study was document review. Secondary panel data were gathered from audited annual reports of the banks and from Ethiopian national bank then the desired ratios were calculated. Multiple linear regression equation was used to make an estimate of the model using Stata version 10 software. Data was collected from 16 private banks Tables, percentages; mean and standard deviation were established to survey the data. Furthermore, Random Effect Model was used to examine bank specific determinates of non-performing loan. loan growth rate, bank size, net interest margin ratio, return on asset and loan to deposit ratio has impact on the degree of NPLs. However, the outcomes did not suggest that equity to total asset ratio activities change the level of NPLs. The study suggests that private commercial banks should focus on many factors when providing loans so as to decrease the amount of NPLs. loan to deposit ratio, net interest margin, loan Growth rate, return on asset, bank Size were critical driver of NPLs, consequently centering and inciting the establishment close by these indicators could reduce the likelihood of NPL in Ethiopian private commercial banks. Further studies are recommended by including macroeconomic and other bank specific variables additionally by increasing the sampled periods. Key words: Loan to deposit ratio, Net interest margin, Loan growth rate, Return on asset, Bank size, Equity to asset ratio
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    Determinants of Non-interest Income in Selected Ethiopian Commercial Banks
    (A.A.U, 2024-06-11) Getawey Gashawbeza; Abebaw Kassie
    This study aims to identify and analyse the determinants of non-interest income (NII) in Ethiopian commercial banks. Specifically, it examines the impact of bank-specific factors, macroeconomic variables, and technological advancements on non-interest income. An explanatory research design with a quantitative approach was employed, utilizing panel data from ten commercial banks in Ethiopia, spanning from 2010 to 2021. Secondary data was collected from internal and external sources, including the National Bank of Ethiopia, the Ministry of Finance, and annual financial reports of the sampled banks. The results indicate that certain bank-specific factors positively and significantly impact non-interest income. Conversely, macroeconomic variables such as GDP growth and inflation rate negatively impact non-interest income. This study provides a comprehensive analysis of the determinants of non-interest income for Ethiopian commercial banks. It highlights the importance of stable funding sources, foreign currency holdings, and macroeconomic conditions. Banks should focus on increasing core deposits, leveraging foreign currency services, and diversifying income streams to mitigate the impacts of economic cycles and inflation. Inflation-adjusted fee structures can help mitigate the erosion of non-interest income. Investments in digital banking services can further enhance non-interest income. Effective risk management remains crucial for maintaining overall financial stability.
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    Determinants of Nonperforming Loans: Evidence from Commercial Banks in Ethiopia
    (Addis Ababa University, 2019-05) Kibur Minas; Abebaw Kassie
    The aim this study is to examine three bank specific and three macroeconomic determinants of nonperforming loans proposed by the literature in the Ethiopian banking system for the period 2005 to 2013 using Arellano Bond (1991) first difference GMM estimation method. The three bank specific factors are ROA, capital to asset ratio and loan to deposit ratio and the three macroeconomic factors are real GDP growth, unemployment and inflation. The estimation result indicates that the coefficient of lagged dependent variable was between 0 and 1 as expected. Profitability and capital adequacy both showed significant (p<0.05) negative effect on NPL. Loan growth has also shown significantly (P<0.05) and positively effect on NPL. However the three macroeconomic factors have insignificant (p<0.1) effect on NPLs. The model was tested for over identification problem by Sargan test as recommended by Aellano Bond (1991). Further two autocorrelation test, AR (1) and AR (2) were conducted to test the assumption of no autocorrelations in the error term. The test result rejected the null hypotheses confirm the validity model assumptions. The results of the research benefit specifically bank managers and financial sector regulatory body.
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    An Empirical Analysis of the Determinants of Trade Balance in Ethiopia (1980-2017)
    (2019-03) Misganaw Chanyalew; Abebaw Kassie
    The main objective of this study is to analyze the determinants of trade balance in Ethiopia during the specified period (1980-2017). Based on review of theoretical and empirical literature, five variables (GDP, GCE, HCE, ER and MS) were identified as general determinants of trade balance in Ethiopia. Moreover, variables are based on elasticity, monetary and absorption theories of trade balance. The study implements ARDL bounds test and error correction model to analyze a time series data from 1980-2017, collected from national bank, World Bank development indicators and IFS. The finding of this study shows that real exchange rate and gross domestic product have positive and significant effect on trade balance while money supply has negative and significant effect on trade balance in long run. Again, long run ARDL model reveals government consumption expenditure and household consumption expenditure have no effect on trade balance. The error correction model of the short-run regression shows that real exchange rate and government consumption expenditure have positive and significant effect on the speed of adjustment of the long-run trend of trade balance. The estimated short run model revealed that the trade balance converges to its equilibrium value. The coefficient of the error term that captures the speed of adjustment towards the long run equilibrium found with the correct sign and magnitude. The speed of adjustment is -0.90, which implies that around 90% deviations from long run equilibrium are adjusted every year and the rest 10% in the coming year.
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    Factors Influencing Bank Selection Decision: An Empirical Analysis on Criteria Employed by Graduating Students at Addis Ababa University
    (Addis Ababa University, 2018-12) Kedir Eshetu; Abebaw Kassie
    The study features an empirical analysis on criteria employed by graduating students in Addis Ababa University towards their bank selection decision. A total of 400 graduating students of Addis Ababa University participated as a sample for the research. Primary sources of survey data were used collected through self-administered questionnaires using a non-probability convenience sampling technique. Data was analyzed using descriptive statistics, regressions processed by Statistical Package for Social Science (SPSS) version 24.0. The result showed that the convenience, Number of branch and ATM, Bank reputation, and E-Banking are found to be a significant factor for students’ bank selection decision. On the other hand, the regression model revealed that third party influence has insignificant effect on bank selection decision. The paper recommends for Bank management to be aware that, factors influencing bank selection decision differ from one segment to another. The study also recommends banks to consider more number of branch and ATM easily accessible in campus, home, and work place with extended operation hours and functional ATMs and offer electronic banking services.
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    Organizational Culture Assessment Using Competitive Value Framework: A Comparative Case Study on Gift Construction and Gift Real Estate
    (AAU, 2025-03-20) Kenean Nigatu Belachew; Abebaw Kassie
    Organizational culture significantly influences employee behavior, decision-making processes, and overall corporate performance. This study assesses the organizational culture of Gift Construction and Gift Real Estate, two sister companies under the GIFT Business Group, using the Competing Values Framework (CVF). The research aims to identify the dominant and preferred cultural profiles of each company, evaluate cultural alignment, and analyze how perceptions differ among employees and management. The descriptive research employed mixed-methods approach, combining quantitative data from the Organizational Culture Assessment Instrument (OCAI) with qualitative insights from interviews. The findings reveal the similarity and differences between the two organizations. Both Gift Construction and Gift Real Estate exhibit a mix of Clan and Market Cultures. Employees in both organizations express a preference for a stronger Adhocracy culture, indicating a desire for increased innovation and flexibility. The study highlights some cultural gaps and their implications for organizational strategy, collaboration, and operational efficiency. Understanding these cultural dynamics enables leadership to implement targeted interventions that foster alignment, enhance employee engagement, and drive sustainable growth