CROSS-BORDER LOAN LIABILITY, THE EXCHANGE RATE AND PROFITABILITY IN THE TURKISH BANKING SECTOR

Gökhan Övenç; Resul Aydemir

doi:10.14780/muiibd.434951

CROSS-BORDER LOAN LIABILITY, THE EXCHANGE RATE AND PROFITABILITY IN THE TURKISH BANKING SECTOR

Abstract

We examine how the cross border banking loan liabilities (syndication and securitization loans) and

the exchange rate affect the Turkish banking industry profitability using a balanced panel data for the

period 2003Q1-2016Q3. We study with different subsamples and model specifications. Overall, we find

that the banking sector financial inflows are positively associated with bank profitability. Specifically, the

results show that the banking sector cross border inflows have significant and positive impact on return

on assets (ROA), return on equity (ROE) and on net interest margin (NIM). The long-term inflows

play a more important role than the short-term inflows in explaining profitability in all specifications

while short-term inflows have no any significant effect on these profitability indicators. Moreover, we

show that the exchange rate has significant and negative impact on ROA and ROE and has insignificant

effect on NIM. Our findings are more notable in private banks compared to the whole sample. Given

the fact that the existing studies examine the banking profitability through aggregate capital inflows

and maturity mismatch, this study will fill a meaningful gap in emerging market literature.

Keywords

Cross Border Banking Liability,Long-term Liability,Short-term Liability,The Exchange Rate,Bank Profitability,Net Interest Margin,Return on Asset

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Details

Primary Language

English

Subjects

Economics

Journal Section

Research Article

Authors

Gökhan Övenç ^*

Resul Aydemir This is me

Publication Date

June 27, 2018

Submission Date

April 1, 2018

Acceptance Date

-

Published in Issue

Year 2018 Volume: 40 Number: 1

DOI

https://doi.org/10.14780/muiibd.434951

IZ

https://izlik.org/JA38KT62PD

Cite

RIS / Bibtex

APA

Övenç, G., & Aydemir, R. (2018). CROSS-BORDER LOAN LIABILITY, THE EXCHANGE RATE AND PROFITABILITY IN THE TURKISH BANKING SECTOR. Marmara Üniversitesi İktisadi Ve İdari Bilimler Dergisi, 40(1), 51-68. https://doi.org/10.14780/muiibd.434951

AMA

1.Övenç G, Aydemir R. CROSS-BORDER LOAN LIABILITY, THE EXCHANGE RATE AND PROFITABILITY IN THE TURKISH BANKING SECTOR. Marmara Üniversitesi İktisadi ve İdari Bilimler Dergisi. 2018;40(1):51-68. doi:10.14780/muiibd.434951

Chicago

Övenç, Gökhan, and Resul Aydemir. 2018. “CROSS-BORDER LOAN LIABILITY, THE EXCHANGE RATE AND PROFITABILITY IN THE TURKISH BANKING SECTOR”. Marmara Üniversitesi İktisadi Ve İdari Bilimler Dergisi 40 (1): 51-68. https://doi.org/10.14780/muiibd.434951.

EndNote

Övenç G, Aydemir R (June 1, 2018) CROSS-BORDER LOAN LIABILITY, THE EXCHANGE RATE AND PROFITABILITY IN THE TURKISH BANKING SECTOR. Marmara Üniversitesi İktisadi ve İdari Bilimler Dergisi 40 1 51–68.

IEEE

[1]G. Övenç and R. Aydemir, “CROSS-BORDER LOAN LIABILITY, THE EXCHANGE RATE AND PROFITABILITY IN THE TURKISH BANKING SECTOR”, Marmara Üniversitesi İktisadi ve İdari Bilimler Dergisi, vol. 40, no. 1, pp. 51–68, June 2018, doi: 10.14780/muiibd.434951.

ISNAD

Övenç, Gökhan - Aydemir, Resul. “CROSS-BORDER LOAN LIABILITY, THE EXCHANGE RATE AND PROFITABILITY IN THE TURKISH BANKING SECTOR”. Marmara Üniversitesi İktisadi ve İdari Bilimler Dergisi 40/1 (June 1, 2018): 51-68. https://doi.org/10.14780/muiibd.434951.

JAMA

1.Övenç G, Aydemir R. CROSS-BORDER LOAN LIABILITY, THE EXCHANGE RATE AND PROFITABILITY IN THE TURKISH BANKING SECTOR. Marmara Üniversitesi İktisadi ve İdari Bilimler Dergisi. 2018;40:51–68.

MLA

Övenç, Gökhan, and Resul Aydemir. “CROSS-BORDER LOAN LIABILITY, THE EXCHANGE RATE AND PROFITABILITY IN THE TURKISH BANKING SECTOR”. Marmara Üniversitesi İktisadi Ve İdari Bilimler Dergisi, vol. 40, no. 1, June 2018, pp. 51-68, doi:10.14780/muiibd.434951.

Vancouver

1.Gökhan Övenç, Resul Aydemir. CROSS-BORDER LOAN LIABILITY, THE EXCHANGE RATE AND PROFITABILITY IN THE TURKISH BANKING SECTOR. Marmara Üniversitesi İktisadi ve İdari Bilimler Dergisi. 2018 Jun. 1;40(1):51-68. doi:10.14780/muiibd.434951