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The Determinants of Bank Profitability: The Case of Tunisia

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  • Olfa Nessibi

    (Higher Institute of Management, University of Tunis, Tunisia)

Abstract

Using bank level data this paper examines how bank’s specific characteristics and macroeconomic indicators affect the profitability in the Tunisian banking industry over the period 1990–2008. The results indicate that themore profitable banks are those higher amount of capital and lower operating costs. Furthermore, it appears that private banks tend toperform better than state owned ones. Despitethe great importance given to the board of directors, it doesn't have a dominant role in the Tunisian commercial banks. Finally, turningto macroeconomicconditionsand its impact on banks’ profitability, we find that the real interest rate has a positive effect on bank profitability.

Suggested Citation

  • Olfa Nessibi, 2016. "The Determinants of Bank Profitability: The Case of Tunisia," International Journal of Finance & Banking Studies, Center for the Strategic Studies in Business and Finance, vol. 5(1), pages 39-50, January.
    • Handle: RePEc:rbs:ijfbss:v:5:y:2016:i:1:p:39-50
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