International Conference in Accounting Researchers and Educators (ICARE)

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Subject: search.filters.subject.Licensed Commercial Banks

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    The Impact of Bank Specific Factors and Macro-Economic Factors on Non-Performing Loans of Commercial Banks in Sri Lanka
    (4th International Conference for Accounting Researchers and Educators, Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2018) Dilshani, W.N.; Abeywardane, D.K.Y.
    Non – Performing Loans (NPL) can be identified as a factor that is negatively affecting to banks’ performances hence it should be mitigated. Banks can’t totally avoid NPL so it becomes a risk for all banks. This study investigates the determinants factors of Non-Performing Loans in Sri Lankan Commercial Banks and aims to identify how both bank specific and macro-economic factors influences on NPL of commercial banks in Sri Lanka. Total Loans to Asset Ratio (LA), Liquidity Asset Ratio (LAR), and Return on Assets (ROA) are the indicators of bank specific factors while Gross Domestic Production (GDP), Inflation Rate (INF) are the indicators of macro-economic factors. The study used secondary data of 25 commercial banks covering the period of 2008 to 2017. Data were analyzed using regression analysis and EViews package. The result reveals that NPL can be affected by both bank specific factors and macro-economic factors. Further LA has positive correlation with NPL. With regards to macro-economic factors NPLs vary negatively with the growth rate of GDP. In conclusion the management of banks should adopt accurate risk mitigation tools by focusing on both bank specific and macro-economic factors that affect the level NPL in banks
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    Association of accounting information on stock prices of licensed commercial banks in Sri Lanka
    (Department of Accountancy, University of Kelaniya, 2015) Perera, R.M.S.M.; Gunaratne, Y.M.C.
    The value relevance of accounting information has become one of the most researched area among accounting researchers. However the value relevance literature provides contradictory conclusions on the association between accounting information and stock prices in different stock exchanges including both developed and developing market settings whilst there is a very limited knowledge in this regard in Sri Lankan Context. Hence this paper focused on examining the association between accounting information and stock prices of licensed commercial banks in Sri Lanka to bridge the knowledge gap in Sri Lankan context. The study conducted based on the hypothesis that there is significant association between accounting information and stock prices in licensed commercial banks in Sri Lanka. Core Capital Adequacy Ratio, Total Capital Adequacy Ratio, Net Non Performing Advances Ratio, Interest Margin, Return on Assets, Return on equity and Statutory liquid Assets Ratio were used as proxy for accounting information. The sample period of the study spans for 5 years from 2007 to 2011. The relevant data was collected from the CSE data library and the published annual reports of all the licensed Commercial Banks whose data is available for the sample period. Both descriptive statistics and inferential statistics were used to analyze data. The statistical analysis revealed that 36% of variations of share prices of Licensed Commercial Banks in Sri Lanka could be explained through the independent variables under study. Further this study revealed that there is a significant relationship between share price and Interest Margin, Return on Equity and Return on Asset. Accordingly this study concluded that there is an association between the accounting information and the share prices of the licensed commercial banks in Sri Lanka hence the accounting information is value relevance in determining share prices of such companies.