EXAMİNİNG OF THE FACTORS DETERMİNİNG PROFİTABİLİTY İN THE BANKİNG SECTOR: PANEL DATA ANALYSİS

Abstract

A well-functioning and developing financial system can make countries and their economic systems stronger. The Turkish banking sector operates as the structure with the highest share fulfilling its intermediary role in the financial system. The aim of the study is to examine the factors that determine profitability in the banking sector, which has such an important place in the economic system. For this purpose, the data of 24 banks operating in the Turkish banking sector for the period of 2010-2020 is analyzed by panel data analysis method. As a result, in the analysis period, the explanatory variables of equity/total assets, total loans/total assets are positive and significant in explaining return on assets (ROA), return on equity (ROE) and net interest margin (NIM); fixed assets/total assets explanatory variable also has also significant and negative effects.