Commercial bank net interest margins - an experimental study in Vietnam

Abstract

The purpose of this research is to determine the factors that affect the net interest margins of commercial banks in Vietnam. The data used for the research were collected from the financial reports of 16 commercial banks in Vietnam during the period 2008-2015. The research applies the panel data regression models, including the pooled regression model (POLS), the fixed effect model (FEM) and the random effect model (REM). Next, the research employs the feasible generalized least squares (FGLS) technique to ensure the viability and effectiveness of the research model. The research result shows that the equity to total capital ratio (CAP), the loans to total assets ratio (LOAN), the liquidity ratio (LIQ), and the inflation ratio (INF) have an impact on the net interest margin of commercial banks.