Jump to ContentJump to Main Navigation
Show Summary Details
More options …

Studia Universitatis „Vasile Goldis” Arad – Economics Series

4 Issues per year

Open Access
See all formats and pricing
More options …

The Influence of the Endogenous and Exogenous Factors on Credit Institutions’ Return on Equity

Nicolae Baltes / Maria-Daciana Rodean
Published Online: 2015-06-16 | DOI: https://doi.org/10.1515/sues-2015-0002


The research’s purpose is to study the credit institutions’ performance, from the shareholders’ point of view, through return on equity (ROE). It aims to identify a dependency relationship between return on equity (ROE) and endogenous factors (the growth rate of credit portfolio, the growth rate provisions, the solvency ratio), on the one hand and, on the other hand between ROE and the exogenous ones (GDP and inflation rate). The research was done over an horizon of 10 years (2004-2013) on the evolution of the return on equity indicator of two credit institutions listed on Bucharest Stock Exchange (Carpathian Commercial Bank SA and Banca Transilvania SA), highlights their vulnerability to economic conditions. The results obtained indicates, that in both credit institutions, the variation of return on capital is determined in a significant proportion by intern factors and it is conditioned in a insignificant share by the exogenous factors

Keywords: ROE; endogenous and exogenous factors; profitability; multiliniar regression; credit institution


  • 1. Khrawish, H. A. (2011). Determinants of commercial banks performance: evidence from Jordan. International Research Journal of Finance and Economics (81), 148-159. Retrieved from http://www.internationalresearchjournaloffinanceandeconomics.comGoogle Scholar

  • 2. Navapan, K., & Tripe, D. (2003). An exploration of the relationship between bank capital levels and return on equity. Proceeding of the 16th Australasian Finance and Bank. Conf. AFBC’03). Palmerston North, pp.1-15.Google Scholar

  • 3. Popa, M., Multiline Regression, document available online: http://www.mpopa.ro/statistica_master/05_statm_regresia%20mutipla.pdf, accesed in 05.03.2015Google Scholar

  • 4. Rajan, R., 2005. Has financial development made the world riskier? Paper presented at the Federal Reserve Bank of Kansas City Economic Symposium at Jackson Hole.Google Scholar

  • 5. Shaher, T. A., Kasawneh, O., & Salem, R. (2011). The major factors that affect banks’ performance in Middle Eastern countries. Journal of Money, Investment and Banking (20), 101-109. Retrieved from http://www.eurojournals.com/JMIB.htmGoogle Scholar

  • 6. Thampy, A. (2004). BIS capital standards and supply of bank loans. Working Paper Series. Retrieved from http://ssrn.com/abstract=561723Google Scholar

  • 7. Annual Reports of Carpathian Bank SA during 2004-2013, available online: www.carpatica.roGoogle Scholar

  • 8. Annual Reports of Transilvania Bank SA during 2004-2013, available online: www.bancatransilvania.roGoogle Scholar

  • 9. www.insse.roGoogle Scholar

  • 10. National Bank of Romania, Financial Stability Report, 2014, available online: http://www.bnro.ro/Publicatii-periodice-204.aspx Google Scholar

About the article

Received: 2015-02-01

Accepted: 2015-04-01

Published Online: 2015-06-16

Published in Print: 2015-05-01

Citation Information: Studia Universitatis „Vasile Goldis” Arad – Economics Series, Volume 25, Issue 1, Pages 16–25, ISSN (Online) 1584-2339, DOI: https://doi.org/10.1515/sues-2015-0002.

Export Citation

© 2015. This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License. BY-NC-ND 3.0

Comments (0)

Please log in or register to comment.
Log in