Determinants of the exit decision of foreign banks in India
AbstractThere is hardly any study in the existing literature regarding the foreign banks’ exit decision in India. This study tries to identify the CAMEL (i.e., C=Capital adequacy, A=Asset quality, M=Management decision, E=Earning ability and L=liquidity) variables that could qualify as the determinant of foreign banks closing their business operations in India which entered after the financial sector reforms. Logistic Regression Model was used to identify the risk factors associated with the closure of business-operation of foreign banks in India. It seems that foreign banks with higher non-performing assets (NPAs), lower return on equity and lesser profit per employee were more likely to close their business in India than otherwise.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 38722.
Date of creation: 10 May 2012
Date of revision:
Publication status: Published in Ushus Journal of Business Management 1.10(2011): pp. 1-16
CAMEL; Logistic Regression Model; Foreign Banks; India;
Find related papers by JEL classification:
- C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
- C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-05-22 (All new papers)
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