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The Effect of Financial Structure on Profitability of Financial Firms on NASDAQ and NYSE Stock Exchanges

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  • Mehmet Akarçay

Abstract

This study examines how financial structure impacts the profitability of banks and financial institutions listed on the New York Stock Exchange (NYSE), one of the largest stock exchanges in the United States, and the National Association of Securities Dealers Automated Quotations (NASDAQ), the leading global technology stock exchange. In this context, a panel data regression analysis was conducted by taking into account the financial data between 2015 and 2024 of 320 enterprises with complete financial statement data. In the first stage of the study, cross-sectional dependence of the series was tested, and then second-generation unit root tests that take into account cross-sectional dependence were performed. To decide between the random effects model and the fixed effects model, the Hausman test is conducted to choose the suitable regression model. Then, Durbin-Watson and Wald tests were performed to solve the autocorrelation and variance problems in the series, respectively, and regression models were estimated for the series for which autocorrelation and variance problems were eliminated. The empirical findings of the research are that the financial structures of all dependent variables are affected more by macroeconomic variables than by bank-specific variables and that this situation affects the profitability of banks and financial institutions.

Suggested Citation

  • Mehmet Akarçay, 2025. "The Effect of Financial Structure on Profitability of Financial Firms on NASDAQ and NYSE Stock Exchanges," Journal of Research in Economics, Politics & Finance, Ersan ERSOY, vol. 10(3), pages 1033-1053.
    • Handle: RePEc:ahs:journl:v:10:y:2025:i:3:p:1033-1053
    DOI: 10.30784/epfad.1696335
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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