The Impact of Market Power and Income Structure on the Profitability and Insolvency Risk in Iran Banking System

راهبرد مدیریت مالی

Mohammad Poortalebi Jaghargh¹  hojjat-allah ansari²  reza raei³ 

[1] Department of Finance and Insurance, Faculty of Management, University of Tehran;Finance Assistant Professor at Alzahra University;Finance Professor at University of Tehran;

关键词: Bank;    Market Power;    Income Structure;    profitability;    Insolvency Risk;   

DOI  :  10.22051/jfm.2018.19002.1591

来源: DOAJ

【 摘 要 】

The advent of financial crises often lead to a banking crisis and if the economy is not able to overcome this, it can endanger the country into bankruptcy. Therefore, on the one hand, perusing different dimensions of banking system and influential factors can deter destructive events in system and on the other hand in case of a meltdown can pave the way to conquer. In this research after studying the principles of market power and income structure in banking sector, the impact of these two factors on banking performance from profitability and insolvency risk perspectives will be discussed. The results of this research which has been done using the financial information of 17 banks in the period of 2007 to 2015 show that the more market power measured by Lerner index, the better the profitability would be and in this circumstance banks will be more stable. It has also shown that the incremental share of noninterest income in total revenue leads to higher profitability in general but after 2011 this effect has reversed. Furthermore, more noninterest income led to more insolvency risk.

【 授权许可】

Unknown