"Performance Analysis of Selected Local Private Commercial Banks in Bangladesh"

Abstract

Performance of private commercial banks (PCBs) in Bangladesh depends on some internal and external factors such as bank size, risk management, overhead cost, capital, ownership of the bank, interest rate spread, bank expenses, inflation, central bank interest rate, GDP, taxation, variables that represents market characteristics (e.g. market concentration, industry size and ownership status etc) on the performance of the bank. This paper uses a multi-criteria, performance based index to rank 27 PCBs operating in Bangladesh. Total profit (TP), return on asset (ROA), return on equity (ROE), and labor productivity (LP) for the year ended 2012 have been considered as pillars of the performance based index. After construction of performance index the hypothesis that there is a relationship between bank performance and bank size is tested through regression analysis. It is found that there is significant positive correlation between bank size and their performance.