Commerce and Management
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Item Predictors of Consumer Creditworthiness: Evidence from Personal Loan Borrowers of a Leading Public Bank in Sri Lanka(Department of Finance, University of Kelaniya., 2023) Nadeesha, R. P. S.; Madhushani, P. W. G.Purpose: The motivation of this study is to explore the significant determinants of consumers’ creditworthiness which support the development of a credit scoring model as non-performing loans are a major problem in lending institutions. Design/Methodology/Approach: Data were collected from four branches of a leading Commercial Bank in the Gampaha District under the convenience sampling technique with 130 personal loan borrowers as the study sample. Findings: The logit model test resulted that age, level of education, and monthly income, are positively influencing the creditworthiness of the borrowers. Increasing the number of dependents and the tenure of the loan have more chances of default. 39% to 56% of the dependent variable was explained by the independent variables in the regression model and the model predicted default correctly by 85.4%. Originality: The study contributes to the existing literature in terms of identifying important predictors for developing a credit-scoring model while helping lenders to assess the creditworthiness of personal loan applicants. Hence the study will assist in taking effectual measures to enhance the quality of the credit approval process and ultimately reduce the losses of lending institutions from bad debt.Item Short and Long-term Determinants of Commercial Bank Deposit Growth in an Emerging South Asian Economy: Sri Lanka(Department of Finance, University of Kelaniya., 2021) Ariyasena, D. L. M. N. K.Purpose: The purpose of this research is to examine the main factors determining the growth of commercial bank deposits in Sri Lanka for the period 1999 - 2017. Design/Methodology/Approach: The research uses micro and macro level data collected from purposive random basis. The autoregressive distributed lag approach used to determine the significant micro and macro factors of banks deposit growth. Findings: The results show that bank steadiness, the productivity of the banking sector, the large supply of capital, economic growth and inflation are important long-term determinants of deposit growth. The findings additionally show that for bank deposit mobilization, only branch expansion and large money supply are important in the short term. Originality / Value: This study divergent from the extant from the scope empirical studies that focus on the determinants of individual savings behavior in Sri Lanka. The research investigates distinctly how bank characteristics affect deposit growth in view of the short- and long-run time dimensions, thus offering a relatively groundbreaking effort arena. Research Limitations/Future Research Directions – This is based on only for a period of eighteen years and only few determinants have been used for the study due to data availability. However, this study can be extended by using other determents of bank deposits and considering a longer time horizon.Item The Impact of Green Banking Practices on Bank Financial Performance, Study Based on Commercial Banks of Sri Lanka(Department of Finance, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka., 2025) Amarasiri, G. D. M. N.; Fernando, J. M. R.Introduction: This study focused on the Impact of Green Banking Practices on Bank Financial Performance Study Based on Commercial Banks of Sri Lanka. Local or foreign researchers have not done any research considering the recent effect of green banking practices by evaluating the quantitative data on financial performance. Methodology: To address the three objectives; impact of green costs on the bank’s financial performance, the impact of corporate governance and its moderate relationship between green banking practices and banks’ financial performances, the effect of country regulation, and moderate the relationship between green banking practices and the financial performance of 10 licensed commercial banks in Sri Lanka under registration in the Colombo Stock Exchange, this study uses six variables including one dependent variable, one independent variable, two moderate variables, and two control variables. The study used secondary data from banks' annual reports and worldwide Governance Indicators from 2015 to 2023 and used panel regression to analyze the data. Findings: The study found green costs are negatively significant with ROA, demonstrating that short-term costs related to green initiatives could have a negative impact on short-term financial performance. While country regulatory, and corporate governance showed a significant positive relationship with ROA. Conclusion: This research suggests that bank financial performance is significantly impacted by green cost, green governance, and green country. Strong corporate governance procedures are crucial for promoting sustainable growth.Item Impact of Risk Management on Firms’ Financial Performance: Evidence from Licensed Commercial Banks in Sri Lanka(Department of Finance, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka., 2025) Sandeepani, W. R. N.; Piyananda, S. D. P.Introduction: This study investigates how methods for risk management affect Sri Lankan commercial banks with permissions and their financial results. Effective risk management is now essential to maintaining the profitability and security of banks in a financial environment that is becoming more and more uncertain. The research focuses on key risk factors: nonperforming loans (NPL), loans and advance (LA), loan loss provision (LLP), liquidity ratio (LR), and return on equity (ROA). The study investigates financial statements from seven commercial banks out of the twenty-four commercial banks that are listed on the Colombo Stock Exchange. They are selected under the sufficient of data category and other banks excluded due to the insufficient of data. Methodology: All the data collected as secondary data from annual report from 2019 to 2023 of each bank and the data analyzed by using regression analysis. The data set was analyzed using EVIEWS software. Furthermore, the firm’s performance measured by Return on Asset and risk management measured by loan loss provision, loans and advances, non-performing loans and capital adequacy ratio. Findings: Loans and advances (LA) represent a critical role in improving financial performance, as the analysis shows that they have a statistically significant and positive impact on ROA. On the other hand, ROA is not significantly correlated with Loan Loss Provisions (LLP), Non-Performing Loans (NPL), Liquidity (LIQ), or the Capital Adequacy Ratio (CAR). While the model explains a moderate proportion of the variation in ROA, the adjusted R-squared suggests room for improvement in predictive accuracy. The overall model is statistically significant, with no evidence of autocorrelation in the residuals. Conclusion: In conclusion, these findings highlight the urgent need for more empirical and theoretical research to strengthen the model's explanatory power, improve its predictive stability, and provide a more comprehensive, complex understanding of risk management's multiple influence on bank performance, operational efficiency, and financial stability.Item Assessing Profitability of Sri Lankan Commercial Banks Amidst Crisis(Faculty of Commerce and Management Studies University of Kelaniya., 2024-11-01) Gunasekara, H.M.A.L.; Ranasinghe, R.A.P.M.; Jayasinghe, G.D.C.T.This study aims to examine whether the Covid 19 pandemic and the post pandemic economic crisis have damaged the primary profitability of commercial banks. This study uses annual data from 2011 to 2023 for ten leading public and private domestic commercial banks in Sri Lanka. The results have been obtained using panel regression models and mean comparison tests. This study identified that the primary profitability measured by ROA is lower during health crisis and economic crisis periods and it achieves statistical support under comparison tests. The negative impact on ROA is dominant in the first Covid 19 year (2020) and the first economic crisis year (2022) than other periods. Further, comparison tests show that the impacts of any crisis are not superior to one another. However, when controlled for the bank-specific and macroeconomic factors, the negative differential effect of both crises fails to achieve statistical significance, indicating that Covid 19 and post- pandemic economic crisis have impacted domestic commercial banks weakly. This is the first kind of study to uncover that the domestic commercial banks have managed to maintain their primary profitability without a large injury to ROA during the health crisis and economic crisis years, helping them remain resilient during the crisis period.