The Effect of Internal Factors on the profitability of Nib International Bank Share Company.

Abstract

The aim of this research was to examine the effect of internal Factors on the profitability of Nib International Bank Share Company. The bank has a total capital of around 3 billion in the year of June, 30/2018 report. The scope limitation was to assess only the effect of internal factors that affect the profitability of Nib international bank Share Company. This study was used the secondary time series data to analyze the Effect of internal factors on the independent variables of (asset quality, capital adequacy, operational cost efficiency and liquidity) and the dependent variable of profitability measured by (ROA),of Nib International bank share company. The Bank from2003 to 2018 with 16 years observations. Data was gathered from secondary source such as financial statements and balance sheets of the Nib international bank Share Company. Furthermore a descriptive and explanatory research design and linear regration model was used to examine the dependent and independent variables. This research is a quantitative research approach was used. However, the result indicates that there is a significant positive correlation between ROA of Nib international bank with capital adequacy ratio and liquidity variables, as well as a negative correlation with ROA of Nib international bank share company and asset quality and operational cost efficiency variables. Moreover, it is recommended that empirical studies should be undertaken in the same field to find out what more internal factors could affect profitability of banks.