Bangladesh and Pakistan

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    Comparative Study on Banks Performance Between Bangladesh and

    Pakistan

    1111137 Arsal Ahmed

    1111143 nam !llah "han

    11111#4 $uhammad !%air Ali "han

    Supervised &y' Shumaila (e&

    S)A)**+ (!,-"A. A, B)!//0 S//!/* 0- SC*C* 2

    /*C)0,0

    5!* 61#

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    Comparative Study on Banks Performance Between Bangladesh and Pakistan

    by

    Arsal Ahmed

    Inam Ullah Khan

    Muhammad Uzair Ali Khan

    Supervisors Name: Shumaila Zeb

    A thesis submitted to the faculty of

    Manaement Sciences

    In partial ful!llment of the re"uirements for the deree

    #achelors of #usiness Administration

    Shaheed Zul!"ar Ali #hutto Institute of Science $ %echnoloy

    Islamabad &ampus

    '(une )*+,-

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    .esearch Pro8ect .eport Approval Certificate

    This is to certi! th"t Re#istr"tio$ % &&&&&'( Ars") Ah*e+, Re#istr"tio$ % &&&&&-' I$"*

    U))"h Kh"$ . Re#istr"tio$ % &&&&&/- M0h"**"+ U1"ir A)i Kh"$ h"2e co*3)ete+ the

    Rese"rch Pro4ect Re3ort o$ Co*3"r"ti2e St0+! o$ B"$5s Peror*"$ce Bet6ee$

    B"$#)"+esh "$+ P"5ist"$ 0$+er *! s03er2isio$ o Ms7 Sh0*"i)" 8e97 The st0+! is

    co*3)ete i$ ")) res3ect7

    S03er2isor N"*e . Si#$"t0re D"te

    ::::::::::::::::::::::::::::::::::: ::::::::::::::::::::

    Pro#r"* M"$"#er N"*e . Si#$"t0re D"te

    ::::::::::::::::::::::::::::::::::: :::::::::::::::::::::

    .

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    +eclaration -orm

    We, Re#istr"tio$ % &&&&&'( Ars") Ah*e+, Re#istr"tio$ % &&&&&-' I$"* U))"h Kh"$

    Re#istr"tio$ % &&&&&/- M0h"**"+ U1"ir A)i Kh"$ +ec)"re th"t the Rese"rch Pro4ect

    tit)e+ Co*3"r"ti2e St0+! o$ B"$5s Peror*"$ce Bet6ee$ B"$#)"+esh "$+ P"5ist"$

    s09*itte+ 9! 0s i$ 3"rti") 0)i))*e$t o the re;0ire*e$t or the +e#ree o B"che)ort o the Rese"rch

    Pro4ect Re3ort7 We t"5e 0)) res3o$si9i)it! o the "9o2e +ec)"r"tio$7 The "i*, +isc0ssio$,

    o9ser2"tio$s, co**e$ts, "$+ 2ie63oi$ts e>3resse+ i$ the Rese"rch Pro4ect Re3ort "re the

    so)e res3o$si9i)it! o the "0thors7 It +oes $ot re3rese$t the 3ositio$ o the Sh"hee+

    80)i5"r A)i Bh0tto I$stit0te o Scie$ce . Tech$o)o#! Is)"*"9"+ C"*30s or its "c0)t!7

    We ")so 0$+erst"$+ th"t i e2i+e$ce o 3)"#i"ris* is o0$+ i$ o0r Rese"rch Pro4ect Re3ort

    "t "$! st"#e e2e$ "ter "6"r+ o the +e#ree, the 6or5 *"! 9e c"$ce))e+ "$+ the +e#ree

    re2o5e+7

    :::::::::::::::::::: Ars") Ah*e+ &&&&&'(

    ::::::::::::::::::::: I$"* U))"h Kh"$ &&&&&-'

    ::::::::::::::::::::: M0h"**"+ U1"ir A)i Kh"$ &&&&&/-

    )

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    :::::::::::::::::::: S03er2isor ? Ms7 Sh0*"i)" 8e9

    .esearch Pro8ect .eport Correctness Certificate

    Certiie+ th"t the ")) o9ser2"tio$s "$+ co**e$ts, co**0$ic"te+ to 0s 9! the Dee$se

    P"$e) +0ri$# the Dee$se o the Rese"rch Pro4ect "$+ s09se;0e$t)! 9! the De3"rt*e$t,

    h"2e 9ee$ i$cor3or"te+ i$ the Re3ort7

    :::::::::::::::::::::::::::&&&&&'( Ars") Ah*e+

    :::::::::::::::::::::::::::&&&&&-' I$"* U))"h Kh"$

    :::::::::::::::::::::::::::&&&&&/- M0h"**"+ U1"ir A)i Kh"$

    :::::::::::::::::::::::::::

    Ms7 Sh0*"i)" 8e9 @S03er2isor

    .

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    /

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    Acknowledgement

    First o ")) 6e 6o0)+ )i5e to th"$5 A))"h A)*i#ht!, 6ho #"2e 0s the stre$#th "$+ 6is+o*

    to co*3)ete this rese"rch 3ro4ect i$ " 9est 3ossi9)e *"$$er7 We 6o0)+ )i5e to e>3ress o0r

    +ee3est #r"te0)$ess to o0r s03er2isor Ms Sh0*"i)" 8e9 or her 3recio0s "+2ice, s033ort

    "$+ ee+9"c5 +0ri$# the 6riti$# o thesis7 We "re th"$50) to her or her s3eci") s033ort

    or this 3ro4ect 6e h"2e )e"r$e+ " )ot ro* her "+2ice "$+ #0i+"$ce 9"se+ o$ the 2"st

    5$o6)e+#e "$+ e>3ertise th"t she h"s i$ the ie)+ o i$"$ce7

    We ")so 3)"ce o$ recor+, o0r se$se o #r"tit0+e to o$e "$+ ")) 6ho, +irect)! "$+ i$+irect)!,

    h"2e )e$t their he)3i$# h"$+ i$ this thesis7

    L"st, 90t $ot the )e"st, o0r si$cere th"$5s to ")) rie$+s "$+ co))e"#0es 6ho h"2e

    coo3er"te+ or o0r rese"rch "$+ *"+e it " s0ccess7 Th"$5 !o0 "))

    ,

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    /a&le of Contents

    &hapter +0 Introduction11111111111111111111111111111111111111111111111111111111111111111111111111+

    &7& B"c5#ro0$+ o the 3ro9)e*111111111111111111111111111111111111111111111111111111111111111111111+

    &7 B"$5i$# Sector o P"5ist"$111111111111111111111111111111111111111111111111111111111111111111111)

    &7' B"$5i$# Sector o B"$#)"+esh11111111111111111111111111111111111111111111111111111111111111111.

    &7- I+e$tiic"tio$ o the G"3111111111111111111111111111111111111111111111111111111111111111111111111,

    &7/ Pro9)e* St"te*e$t1111111111111111111111111111111111111111111111111111111111111111111111111111111,

    &7 O94ecti2e o the st0+!111111111111111111111111111111111111111111111111111111111111111111111111111,

    &7( Si#$iic"$ce o the St0+!111111111111111111111111111111111111111111111111111111111111111111111112

    &7 Rese"rch ;0estio$s11111111111111111111111111111111111111111111111111111111111111111111111111111112

    Ch"3ter Liter"t0re Re2ie611111111111111111111111111111111111111111111111111111111111111111111111113

    7& Liter"t0re Re2ie61111111111111111111111111111111111111111111111111111111111111111111111111111111113

    7 Pro3ose+ H!3otheses11111111111111111111111111111111111111111111111111111111111111111111111111+,

    &hapter . 0 4esearch Methodoloy111111111111111111111111111111111111111111111111111111+2

    '7& D"t" Descri3tio$11111111111111111111111111111111111111111111111111111111111111111111111111111111+2

    '7 V"ri"9)e Descri3tio$111111111111111111111111111111111111111111111111111111111111111111111111111+3

    '77& Proit"9i)it! R"tio1111111111111111111111111111111111111111111111111111111111111111111111111+3

    '77 Li;0i+it! R"tio1111111111111111111111111111111111111111111111111111111111111111111111111111+3

    '77' So)2e$c! R"tio1111111111111111111111111111111111111111111111111111111111111111111111111111+5

    '77- Asset J0")it! R"tio11111111111111111111111111111111111111111111111111111111111111111111111+5

    '7' Metho+o)o#!111111111111111111111111111111111111111111111111111111111111111111111111111111111111+5

    Ch"3ter - D"t" A$")!sis "$+ Fi$+i$#s11111111111111111111111111111111111111111111111111111111111)*

    -7& Descri3ti2e A$")!sis111111111111111111111111111111111111111111111111111111111111111111111111111)*

    -7 Corre)"tio$s11111111111111111111111111111111111111111111111111111111111111111111111111111111111111)+

    -7' P"$e) Re#ressio$ A$")!sis11111111111111111111111111111111111111111111111111111111111111111111)/

    -7- Co*3"riso$11111111111111111111111111111111111111111111111111111111111111111111111111111111111111)2

    Ch"3ter / Co$c)0sio$11111111111111111111111111111111111111111111111111111111111111111111111111111111)3

    Ch"3ter Reco**e$+"tio$s "$+ F0t0re Rese"rch1111111111111111111111111111111111111111111)5

    Reere$ces11111111111111111111111111111111111111111111111111111111111111111111111111111111111111111111111)6

    )

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    ,ist of /a&le

    T"9)e '7 &? S"*3)e Se)ecte+ B"$5s o P"5ist"$11111111111111111111111111111111111111111111111111+2T"9)e '7 ? S"*3)e Se)ecte+ B"$5s o B"$#)"+esh1111111111111111111111111111111111111111111111+27

    T"9)e -7 &? Descri3ti2e St"tistics @P"5ist"$ )*T"9)e -7 ? Descri3ti2e St"tistics @B"$#)"+esh )+T"9)e -7 '? Corre)"tio$ M"tri> @P"5ist"$ ))T"9)e -7 -? Corre)"tio$ M"tri> @B"$#)"+esh ).

    T"9)e -7 /? Re#ressio$ @P"5ist"$ )/T"9)e -7 ? Re#ressio$ @B"$#)"+esh ),T"9)e -7 (? Co*3"riso$ 9et6ee$ P"5ist"$ "$+ B"$#)"+esh )2

    .

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    Th0s, 9! co*3"ri$# 6ith B"$#)"+esh 6e c"$ ")so i+e$ti! the *ist"5es or the

    o33ort0$ities 6e *isse+ i$ the 3"st !e"rs "$+ 6here o0r 3ro9)e*s )ie7 A)so, 6e choose

    B"$#)"+esh 9ec"0se $o co*3"r"ti2e st0+! o s0ch t!3e h"s 9ee$ +o$e 9eore o$ these

    t6o co0$tries7

    196 Banking Sector of Pakistan

    The 9"$5i$# sector o P"5ist"$ h"s #re"t)! )o0rishe+ +es3ite its s)o6 9e#i$$i$#

    "ter i$+e3e$+e$ce7 Ti)) &- 6e e2e$ +i+ $ot h"2e " ce$tr") 9"$57 '& 9r"$ches o -/

    sche+0)e+ 9"$5s 6ere o3er"ti$# i$ P"5ist"$ "t the ti*e o i$+e3e$+e$ce7 The 9"$5i$#

    sector s0ere+ #re"t )osses +0e to 0$cert"i$t! i$ &-( "$+ it "ecte+ the P"5ist"$i 9"$5s

    *ost +0e to 6hich the 9"$5s 6hich 6ere re#istere+ i$ P"5ist"$ shite+ to I$+i"7 D0e tothis shiti$# o 9r"$ches "$+ he"+ oices to I$+i"$ "re"s the $0*9er o oices e)) ro*

    '& to &/ 9! &'th 0$e &-7 O$ the other h"$+ o$)! -- oices 6ere shite+ ro* I$+i"

    to P"5ist"$7 I$+i"$ 9"$5s shite+ their oices ;0ic5)! 9ec"0se the! 6"$te+ th"t the! $e6

    st"te co))"3se ;0ic5)! "$+ "#"i$ *er#es 6ith I$+i"7

    It 6"s +iic0)t or the P"5ist"$i "0thorities to est"9)ish " ce$tr") 9"$5 ri#ht "ter

    i$+e3e$+e$ce thereore the! *"+e "$ "#ree*e$t 6ith the Reser2e B"$5 o I$+i" to 6or5

    "s the ce$tr") 9"$5 o P"5ist"$7 D0e to the )"c5 o e>3erie$ce+ "$+ tr"i$e+ st" it 6"s "

    2er! +iic0)t +ecisio$ or the #o2er$*e$t to est"9)ish their o6$ ce$tr") 9"$5 thereore

    so*e o the* 6ere o the 2ie6 i$iti"))! " c0rre$c! 9o"r+ *0st 9e est"9)ishe+ 90t +0e to

    the $e#"ti2e 3o)icies o Reser2e B"$5 o I$+i" "#"i$st P"5ist"$ the "#ree*e$t 6"s

    c"$ce)e+ "$+ the #o2er$*e$t o P"5ist"$ h"+ to t"5e the 9o)+ +ecisio$ o est"9)ishi$# "

    0))! )e+#e+ ce$tr") 9"$5 "$+ "s " res0)t St"te B"$5 o P"5ist"$ 6"s est"9)ishe+ i$ 0)!

    &-7A$other re"so$ or est"9)ishi$# the ce$tr") 9"$5 6"s th"t the i$"$ci") sector i$

    P"5ist"$ 6"s i$ 9"+)! "ecte+ 9ec"0se there 6ere $o 3ro3er r0)es "$+ re#0)"tio$s "t th"t

    ti*e so "$ or+er 6"s 3"sse+ 9! the #o2er$*e$t 6hich is c"))e+ the St"te 9"$5 o P"5ist"$

    or+er P"5ist"$i c0rre$c! 6"s ")so i$tro+0ce+ i$ the s"*e !e"r "$+ I$+i"$ c0rre$c! 6"s

    6ith+r"6$ ro* the eco$o*!7 A !e"r )"ter the N"tio$") B"$5 o P"5ist"$ 6"s est"9)ishe+

    to ser2e "s the "#e$t o st"te B"$5 o P"5ist"$7

    )

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    With $e6 #o2er$*e$t i$ &(, *"$! $e6 reor*s 6ere i$tro+0ce+ to *"5e the

    9"$5i$# sector *ore eicie$t "$+ eecti2e so th"t it co0)+ 9etter 0$+erst"$+ $e6

    ch"))e$#es "$+ co3e 6ith the*7 The reor*s i*3ro2e+ the s!ste* o #i2i$# cre+its "$+

    e$co0r"#e+ soci") "cco0$t"9i)it!7 U$+er the s03er2isio$ o St"te B"$5 o P"5ist"$ "$+

    the +0e to the reor*s *"+e 9! the $e6 #o2er$*e$t the 9"$5i$# sector sho6e+ #re"t

    #ro6th "$+ the $0*9er o 9r"$ches i$cre"se+ ro* &/ to ' 6hich 6ere )oc"te+

    thro0#ho0t the co0$tr!7 A3"rt ro* these i$ter$"tio$") o3er"tio$s 6ere ")so st"rte+ 6ith

    (& 9r"$ches o0tsi+e P"5ist"$7 At this ti*e " tot") o &- sche+0)e+ 9"$5s 6ere 6or5i$# i$

    P"5ist"$7

    I$ &(-, $"tio$")i1"tio$ 3o)icies 6ere "+o3te+ "$+ these &- 9"$5s 6ere *er#e+

    to#ether "$+ i2e *"4or 9"$5i$# co*3"$ies 6ere or*e+7 P"5ist"$ B"$5i$# Co0$ci) 6"s

    ")so or*e+ to )oo5 "ter the *"tters o these 309)ic 9"$5i$# co*3"$ies7 I$ this er" the

    309)ic sector co$tro))e+ the 9"$5s i$ P"5ist"$ +0e to 6hich the 3eror*"$ce +ecre"se+

    +0e to i$eicie$cies7 A$other re"so$ o the +ecre"se o the 3eror*"$ce 6"s the

    90re"0cr"tic "33ro"ch to6"r+s the 3ro9)e*s o the i$"$ci") sector7 Po)itic") i$)0e$ce

    6"s 0se+ i$ hiri$# "$+ iri$# o e*3)o!ees7 D0e to the $"tio$")i1"tio$, *ost o the 3ri2"te

    i$2estor tr"$serre+ their *o$e! to "9ro"+ to st"rt their o6$ 90si$ess7

    I$ &s 3ri2"ti1"tio$ 3o)icies 6ere "+o3te+ "$+ ' 9"$5s 6ere est"9)ishe+7 I$

    &( sti)) there 6ere - st"te o6$e+ 9"$5s 90t there 6"s ")so co*3etitio$ ro* & )oc")

    9"$5s "$+ ( orei#$ 9"$5s7 B! &, there 6ere / )oc") 9"$5s, / orei#$ 9"$5s, -

    s3eci")i1e+ 9"$5s "$+ / st"te o6$e+ 9"$5s7 The tot") $0*9ers o 9r"$ches i$ P"5ist"$ "re

    '- 6hich "re c"teri$# the $ee+s o Mi))io$ c0sto*ers7

    So*e "cts "9o0t the 9"$5i$# sector o P"5ist"$ "re?

    To3 / 9"$5s h"2e / *"r5et sh"re7

    o the 9"$5i$# "ssets "re he)+ 9! 3ri2"te 9"$5s7

    .

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

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    193 Banking Sector of Bangladesh

    B"$#)"+esh #ot i$+e3e$+e$ce i$ &(', "t th"t ti*e there 6ere t6o 9r"$ches o

    St"te B"$5 o P"5ist"$7 The $e6)! *"+e Go2er$*e$t, i**e+i"te)! co$2erte+ Dh"5"

    Br"$ch o St"te o P"5ist"$ to B"$#)"+esh B"$5

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    O$e *"4or e>ce3tio$ i$ B"$#)"+esh B"$5i$# ste* 6"s Gr"*ee$ B"$57 It 6"s "

    #o2er$*e$t 3ro4ect th"t st"rte+ i$ &( "$+ 6"s est"9)ishe+ i$ &', "s "$ i$+e3e$+e$t

    9"$57 The *"i$ 30r3ose o this 9"$5 6"s to he)3 the 3oor7 It 3ro2i+e+ s*")) )o"$s to the

    3oor "$+ $ee+! 3eo3)e o$ re"so$"9)e ter*s7 Its c0sto*ers i$c)0+e+ 3eo3)e, ho*e)ess "$+

    es3eci"))! 6o*e$ @( o the c0sto*ers 6ere 6o*e$, 6ho co0)+ $ot "or+ " )i2i$#

    "$+ +i+$

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    co0$tr! @6hich h"s " si*i)"r $"t0re "$+ is ")so " +e2e)o3i$# co0$tr! this rese"rch 6"s

    co$+0cte+ to i$+ o0t 6here o0r 9"$5s tr0)! st"$+7

    19# Pro&lem Statement

    E2")0"ti$# 9"$5s 3eror*"$ce i$ter$"tio$"))! "$+ i$+i$# o0t the eicie$c! o

    9"$5s i$ c0rre$t 90si$ess e$2iro$*e$t7 As $o e>te$si2e st0+! h"s 9ee$ +o$e o$ it,

    es3eci"))! 9et6ee$ B"$#)"+esh "$+ P"5ist"$, so i$ or+er to i)) this #"3 "$+ to #et " 9etter

    i+e" this rese"rch 6"s co$+0cte+7

    19: 0&8ective of the study

    To e2")0"te P"5ist"$

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    J'? Ho6 +oes Li;0i+it! R"tio eects 9"$53eri*e$t, o$e 6"s the B"!es *o+e) "$+

    the seco$+ 6"s i$"$ci") r"tios7 The i$"$ci") r"tios 6ere co$si+ere+ "s "$ i$+ic"tor to

    5$o6 the 9"$5

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    Dh"9i "$+ D09"i 6ere se)ecte+7 The res0)ts sho6e+ th"t the orei#$ 9"$5s o6$e+ / o

    the tot") "ssets i$ 9"$5s7 Proit"9i)it! o the orei#$ 9"$5s "cco0$te+ or 7 The o2er"))

    3eror*"$ce o the 9"$5s i*3ro2e+ i$ the 3"st se2er") !e"rs7 M"4orit! o the 9"$5s 6ere

    0si$# *o+er$ tech$o)o#! "$+ h"2e i*3ro2e+ the eicie$c!7 Both the orei#$ "$+

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    eicie$c!, i$"$ci") 3eror*"$ce "$+ ser2ice ;0")it!7 I$cre"se+ 3eror*"$ce c"$ )e"+ to

    9etter i$"$ci") 3eror*"$ce7 Fi$"$ci") 3eror*"$ce c"$ 9e i*3ro2e+ 9! t6o 6"!s o$e is

    to i*3ro2e o3er"tio$") eicie$c! "$+ seco$+ is c0sto*er c"re7 Fi$"$ci") 3eror*"$ce o

    9"$5s c"$ 9e *e"s0re+ 9! 0si$# +iere$t "cco0$ti$# *e"s0res 90t i$ this st0+! i$"$ci")

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    6ere c"3it") "+e;0"c!, ret0r$ o$ "ssets, i$terest *"r#i$ "$+ i$co*e r"tios7 The +"t"

    co))ectio$ or this st0+! 6"s t"5e$ ro* the "$$0") re3orts o the i$stit0tio$s +0ri$# the

    3erio+ o &-&7the res0)ts sho6s th"t the i$"$ci") 3eror*"$ce +0ri$# the se)ecte+

    ti*e 3erio+ 6"s st"9)e7

    A9+0) R"hee* "$+ A9+0) R"shee+ @- "$")!1e+ th"t the r"tio "$")!sis is the

    *ost eecti2e 6"! to *e"s0re the 3eror*"$ce o 9"$5s "$+ other 90si$esses7 Which

    sho6s the re)"tio$shi3 9et6ee$ the i$"$ci") +"t" "s 6e)) "s the i$"$ci") st"te*e$ts

    The! h"2e ")so 0se+ the i$"$ci") r"tios to *e"s0re the 9"$5 3eror*"$ce i$ their

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

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    o2er")) res0)ts sho6 th"t the i$"$ci") crisis +i+ $ot h"+ "$! +irect eect o$ the O*"$i

    9"$5s "$+ their i$"$ci") 3eror*"$ce i*3ro2e+7

    Is)"*, Si++i;0i "$+ H0ss"i$ @&-, the 9"$5i$# sector o B"$#)"+esh

    co*3ro*ises o $"tio$")i1e+ 9"$5s, 3ri2"te 9"$5s "$+ orei#$ 9"$5s7 The 3eror*"$ce o

    co**erci") 9"$5s 6"s i*3ort"$t +0e to the i$cre"se+ co*3etitio$ o 9"$5s i$

    B"$#)"+esh "$+ this c"$ )e"+ to )o6er 3roit"9i)it! o 9"$5s7 U$ti) the &s the 9"$5s o

    B"$#)"+esh 6ere o6$e+ 9! the st"te 90t the$ B"$#)"+esh e$tere+ the Wor)+ B"$5

    3ro#r"*s "$+ "ter6"r+s *"$! 9"$5s 6ere 3ri2"ti1e+7 Ater the 3ri2"ti1"tio$ o *"$!

    9"$5s the B"$#)"+esh eco$o*! 9ec"*e "$ "ttr"cti2e eco$o*! or 9oth orei#$ "$+

    +o*estic i$2estors7 The *"i$ o94ecti2e o this st0+! 6"s to *e"s0re the 3roit"9i)it! o

    the B"$#)"+eshi 9"$5s 9! 0si$# the i$"$ci") r"tio "$")!sis7 The 9"$5s 6ere +i2i+e+ i$

    t6o +iere$t #ro03s s0ch "s st"te o6$e+ co**erci") 9"$5s, 3ri2"te co**erci") 9"$5s,

    orei#$ co**erci") 9"$5s, "$+ +e2e)o3*e$t i$"$ci") i$stit0tio$7 The ti*e 3erio+ o this

    st0+! 6"s ro* -&& "$+ the +"t" co))ectio$ 6"s ro* seco$+"r! so0rces s0ch "s

    +,

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    "$$0") re3orts o 9"$5s, 4o0r$")s, "rtic)es "$+ s0r2e!s etc7 The res0)ts sho6 th"t the

    3eror*"$ces o the 9"$5s "re 9etter "$+ i*3ro2i$#7

    A+"* @&-co$+0cte+ " rese"rch to *e"s0re the i$"$ci") 3eror*"$ce o the

    9"$5s thro0#h i$"$ci") r"tios i$ Er9i) 9"$5 or i$2est*e$t "$+ i$"$ce7 The "i* o this

    st0+! 6"s to i$2esti#"te the i$"$ci") 3eror*"$ce o the Er9i) 9"$5 or i$2est*e$t "$+

    i$"$ce i$ K0r+ist"$ re#io$ o Ir"; +0ri$# the 3erio+ o &'7 The 9")"$ce sheet

    "$+ the i$co*e st"te*e$t 6ere ")so "$")!1e+7 The i$"$ci") r"tios "re ")so 0se+ to

    co*30te the i$"$ci") 3eror*"$ce o the 9"$57 The res0)ts sho6 th"t the 3eror*"$ce o

    the Er9i) 9"$5 sho6e+ " 3ositi2e si#$7 The o2er")) 3eror*"$ce i$ ter* o r"tios s0ch "s

    )i;0i+it! r"tios, 3roit"9i)it! r"tios, cre+it r"tios "$+ ;0")it! r"tios 6"s i*3ro2e+7

    The i*3ort"$t 2"ri"9)es i$ this rese"rch "re )i;0i+it! r"tio, so)2e$c! r"tio "$+ )o"$

    )oss reser2e 9! tot") )o"$s 6hich "re i$+e3e$+e$t 2"ri"9)es "$+ 9"$5 3eror*"$ce is

    +e3e$+e$t 2"ri"9)e 6hich is *e"s0re+ 9! ROA "$+ is +e3e$+e$t o$ the )i;0i+it! r"tio,

    so)2e$c! r"tio "$+ )o"$ )oss reser2e 9! tot") )o"$s7 The i$"$ci") r"tios he)3 to i+e$ti!

    9"$5

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    Chapter 3 - Research Methodology

    391 +ata +escription

    Fi2e 9"$5s 6ere chose$ ro* 9oth P"5ist"$ "$+ B"$#)"+esh o$ the 9"sis o their

    tot") "sset si1e, 6hich "re H"9i9 B"$5 Li*ite+ @HBL, N"tio$") B"$5 o P"5ist"$ @NBP,

    U$ite+ B"$5 Li*ite+ @UBL, M0s)i* Co**erci") B"$5 @MCB "$+ A))ie+ B"$5 Li*ite+

    ro* P"5ist"$ "$+ So$")i B"$5 Li*ite+, "$"t" B"$5 Li*ite+, Is)"*i B"$5 B"$#)"+esh

    Li*ite+, A#r"$i 9"$5 Li*ite+ "$+ Pri*e B"$5 Li*ite+ ro* B"$#)"+esh7 These "re the

    to3 i2e 9"$5s o their res3ecti2e co0$tries7 J0"$tit"ti2e +"t" o 3re2io0s !e"rs 6"s

    o9t"i$e+ ro* the "$$0") re3orts o these 9"$5s i7e7 ro* to &-7 D"t" o9t"i$e+

    ro* their oici") 6e9site 6"s 0se+ or the c")c0)"tio$ o r"tios7 So0rce o the +"t" is

    oici") 6e9sites o e"ch 9"$5 6here their "$$0") re3orts "re "2"i)"9)e7

    /a&le 39 1' Sample Selected Banks of Pakistan

    Bank ame Asset Structure >P".? millions

    H"9i9 B"$5 Li*ite+ &,(&/,(&N"tio$") B"$5 o P"5ist"$ &,'(,-U$ite+ B"$5 Li*ite+ &,','M0s)i* Co**erci") B"$5 &/,/A))ie+ B"$5 Li*ite+ ('-,&

    /a&le 39 6' Sample Selected Banks of Bangladesh

    Bank ame Asset Structure >B/? millions

    So$")i B"$5 /,/&"$"t" B"$5 /,('Is)"*i B"$5 /-,(A#r"$i B"$5 ---,/Pri*e B"$5 -/,/(

    +3

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    396 @aria&le +escription

    B"$5 3eror*"$ce is o0r +e3e$+"$t 2"ri"9)e 6hich is *e"s0re+ 6ith the he)3 o

    Proit"9i)it! R"tio i7e7 ROA7 I$+e3e$+e$t 2"ri"9)es "re Li;0i+it! r"tio, So)2e$c! r"tio

    "$+ Asset J0")it! R"tios7

    39691 Profita&ility .atio

    These "re those r"tios 6hich "re 0se+ to "ssess " 90si$ess "9i)it! to #e$er"te

    e"r$i$#s "s co*3"re+ to its e>3e$ses "$+ other re)e2"$t costs i$ " s3eciic 3erio+ o ti*e7

    The r"tio 6hich h"s 9ee$ 0se+ i$ o0r rese"rch to *e"s0re the 3eror*"$ce o the se)ecte+

    9"$5s is Ret0r$ o$ Assets @ROA "$+ it

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    39693 Solvency .atio

    These "re those r"tios 6hich "re 0se+ to "sses " 90si$ess "9i)it! to 3"! its )o$#

    ter* "$+ short ter* +e9ts7 It is ")so 0se+ to ;0"$ti! the si1e o "ter t"> i$co*e o "

    co*3"$!7 The or*0)" or so)2e$c! r"tio is Ater T"> Net Proit 3)0s De3reci"tio$ "$+

    the$ +i2i+e+ 9! Tot") )i"9i)ities7 This r"tio te))s 0s th"t 6hether or $ot " co*3"$! is "9)e

    to 3"! its short ter* "$+ )o$# ter* o9)i#"tio$ 6he$ the! co*e +0e7 Lo6er so)2e$c! r"tio

    *e"$s th"t " co*3"$! is *ore )i5e)! to +e"0)t o$ its )o$# ter* "$+ short ter* +e9t

    o9)i#"tio$s7

    39694 Asset uality .atio

    These "re those r"tios 6hich te)) 0s "9o0t the )i5e)ihoo+ o +e"0)t o " cert"i$

    )o"$ or i$2est*e$t7 The r"tio 6hich h"s 9ee$ 0se+ is Lo"$ Loss 9! Tot") Lo"$s 6hose

    or*0)" is Lo"$ Loss Reser2e +i2i+e+ 9! Tot") Lo"$s7 This r"tio te))s 0s "9o0t the ;0")it!

    o )o"$s #i2e$ 9! " 9"$57 The )o6er this r"tio is the 9est it is or the 9"$57 Lo"$ Loss

    Reser2e is " s3eci") 0$+ 6hich is set "si+e "s "$ e>3e$se to o2erco*e $o$3eror*i$#

    )o"$s or +e"0)ts o$ the e$+ o c0sto*ers7 It is the 3ro2isio$s o Lo"$ Losses c")c0)"te+

    "s " 3erce$t"#e o Gross Lo"$s7

    393 $ethodology

    S"*3)e si1e is o & 9"$5s, / 9est 9"$5s ro* P"5ist"$ "$+ / 9est ro*

    B"$#)"+esh7 The seco$+"r! +"t" 6"s o9t"i$e+ ro* the oici") 6e9site o e"ch o the

    res3ecti2e 9"$5s, St"te B"$5 o P"5ist"$ "$+ B"$#)"+esh B"$57 Re#ressio$ "$")!sis h"s

    9ee$ 0se+ to *e"s0re, +escri9e "$+ "$")!1e the 3eror*"$ce o o0r se)ecte+ 9"$5s i$

    P"5ist"$ "$+ B"$#)"+esh +0ri$# the 3erio+ &-, " tot") o !e"rs7 P"$e) re#ressio$

    A$")!sis ")so he)3e+ the rese"rch i$ +eter*i$i$# 6hether there is "$! +iere$ce 9et6ee$

    the 3eror*"$ce o 9"$5s i$ P"5ist"$ "$+ B"$#)"+esh or $ot7 The e;0"tio$ 0se+ or

    "$")!sis is?

    +6

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    ROAit

    0

    1 CRit

    2SRit

    3LTLit

    it

    Where?

    ROA Q Ret0r$ o$ Assets

    CR Q C0rre$t R"tio

    SR Q So)2e$c! R"tio

    LTL Q Lo"$ Loss 9! Tot") Lo"$s

    Q the error ter*

    Q the i$terce3t o e;0"tio$

    1 Q the ch"$#e i$ coeicie$t or C0rre$t R"tio

    2 Q the ch"$#e i$ coeicie$t or So)2e$c! R"tio

    3 Q the ch"$#e i$ coeicie$t or Lo"$ Loss 9! Tot") Lo"$s

    i Q I$+i2i+0") ir*s

    t Q Ti*e 3erio+

    )*

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    Chapter 4 D +ata Analysis and -indings

    491 +escriptive Analysis

    Descri3ti2e st"tistics ;0"$tit"ti2e)! +escri9es *"i$ e"t0res o o0r +"t" set "$+

    3ro2i+e si*3)e s0**"ries "9o0t the +"t"7 It te))s 0s "9o0t the *i$i*0*, *">i*0* "$+

    *e"$ 2")0es o the 2"ri"9)es 6ith st"$+"r+ +e2i"tio$ "$+ 2"ri"$ce7

    /a&le 49 1' +escriptive Statistics >Pakistan?

    N Mi$i*0* M">i*0* Me"$ St+7

    De2i"tio$

    V"ri"$ce

    Ret0r$ o$ Assets ' 7- '7&& &7/' 7' 7--

    C0rre$t R"tio ' 7(& 7- &7--(& 7''' 7&-(

    So)2e$c! R"tio ' 7& 7- 7'( 7(/ 7

    Lo"$ Loss 9! Tot")

    Lo"$s' 7& 7' 7&&' 7 7

    V")i+ N @)ist 6ise '

    The "9o2e t"9)e co$sists o the +escri3ti2e st"tistics o the chose$ 2"ri"9)es7 Me"$

    2")0es sho6s the "2er"#e 2")0e o the 2"ri"9)e "$+ st"$+"r+ +e2i"tio$ sho6s "9o0t the

    +e2i"tio$ ro* the *e"$ 2")0e7 V"ri"$ce te))s 0s "9o0t ho6 "r the set o 2")0es "re

    s3re"+ o0t7 I it is , the$ ")) the 2")0es "re i+e$tic")7 The *i$i*0* 2")0e o Ret0r$ o$

    Asset is 7- "$+ *">i*0* is '7&&7 Its *e"$ is &7/' 6ith " +e2i"tio$ o 7'7 Its

    2"ri"$ce is 7-- 6hich *e"$s th"t -- "re +iere$t ro* e"ch other7 The *i$i*0* "$+

    *">i*0* 2")0es o C0rre$t R"tio "re 7(& "$+ 7- res3ecti2e)!7 Its *e"$ is &7--(& 6ith

    " st"$+"r+ +e2i"tio$ o 7''' "$+ it h"s " 2"ri"$ce o 7&-(7 The 2")0es o So)2e$c!

    )+

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    R"tio "re 9et6ee$ 7& "$+ 7-7 Its *e"$ 2")0e is 7'( "$+ its st"$+"r+ +e2i"tio$ is

    77 Its ")) 2")0es "re i+e$tic") 9ec"0se its 2"ri"$ce is 77 The *">i*0* 2")0e o

    Lo"$ Loss 9! Tot") Lo"$s is 7' "$+ its *i$i*0* 2")0e is 7&7 It h"s " *e"$ o 7&&'

    6ith " st"$+"r+ +e2i"tio$ o 77 A)) 2")0es o Lo"$ Loss 9! Tot") Lo"$s "re

    i+e$tic") 9ec"0se its 2"ri"$ce is ")so 77

    /a&le 49 6' +escriptive Statistics >Bangladesh?

    N Mi$i*0

    *

    M">i*0

    *

    Me"$ St+7

    De2i"tio$

    V"ri"$ce

    Ret0r$ o$ Assets ' -7' &'7 7/ 7&-' (7

    C0rre$t R"tio ' 7'& &7& 7/&- 7(' 7--So)2e$c! R"tio ' 7/ 7& 7&&' 7(- 7&Lo"$ Loss Reser2es 9!

    Tot") Lo"$s' 7 7& 7&(& 7 7&

    V")i+ N @)ist 6ise '

    The "9o2e t"9)e co$sists o the +escri3ti2e st"tistics o the chose$ 2"ri"9)es7 Me"$

    2")0es sho6s the "2er"#e 2")0e o the 2"ri"9)e "$+ st"$+"r+ +e2i"tio$ sho6s "9o0t the

    +e2i"tio$ ro* the *e"$ 2")0e7 V"ri"$ce te))s 0s "9o0t ho6 "r the set o 2")0es "re

    s3re"+ o0t7 I it is , the$ ")) the 2")0es "re i+e$tic")7 The *i$i*0* 2")0e o Ret0r$ o$

    Asset is -7' "$+ *">i*0* is &'77 Its *e"$ is 7/ 6ith " +e2i"tio$ o 7&-' "$+

    " 2"ri"$ce o (77 The *i$i*0* "$+ *">i*0* 2")0es o C0rre$t R"tio "re 7'& "$+

    &7&, res3ecti2e)!7 Its *e"$ is 7/&- 6ith " st"$+"r+ +e2i"tio$ o 7(' "$+ it h"s "

    2"ri"$ce o 7--7 The 2")0es o So)2e$c! R"tio "re 9et6ee$ 7/ "$+ 7&7 Its *e"$

    2")0e is 7&&' "$+ its st"$+"r+ +e2i"tio$ is 7(-7 Its ")) 2")0es "re i+e$tic") 9ec"0se

    its 2"ri"$ce is 7&7 The *">i*0* 2")0e o Lo"$ Loss 9! Tot") Lo"$s is 7& "$+ its

    *i$i*0* 2")0e is 77 It h"s " *e"$ o 7&&' 6ith " st"$+"r+ +e2i"tio$ o 7 "$+" 2"ri"$ce o 7&7

    ))

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    496 Correlations

    Corre)"tio$s te)) 0s th"t ho6 *0ch ch"$#e i$ the +e3e$+e$t 2"ri"9)e is +0e to the

    i$+e3e$+e$t 2"ri"9)es7 The 2")0e i$ e"ch ce)) o the *"tri> is corre)"tio$ coeicie$t7

    /a&le 49 3' Correlation $atriE >Pakistan?

    Ret0r$ o$

    Assets

    C0rre$t R"tio So)2e$c!

    R"tio

    Lo"$ Lo

    Tot") Lo

    Ret0r$ o$ Assets

    Pe"rso$ Corre)"tio$ & 7/ 7( 7Si#7 @t"i)e+ 7( 7 7&

    N ' ' ' '

    C0rre$t R"tioPe"rso$ Corre)"tio$ 7/ & 7& 7&/

    Si#7 @t"i)e+ 7( 7& 7N ' ' ' '

    So)2e$c! R"tioPe"rso$ Corre)"tio$ 7( 7& & 7-Si#7 @t"i)e+ 7 7& 7&&/N ' ' ' '

    Lo"$ Loss 9! Tot")

    Lo"$s

    Pe"rso$ Corre)"tio$ 7 7&/

    7- &Si#7 @t"i)e+ 7& 7 7&&/N ' ' ' '

    7 Corre)"tio$ is si#$iic"$t "t the 7& )e2e) @t"i)e+7

    Corre)"tio$ *"tri> is #i2e$ i$ the "9o2e t"9)e "$+ is sho6s th"t the corre)"tio$

    9et6ee$ Ret0r$ o$ Asset "$+ C0rre$t R"tio is @ 7/ 6hich sho6s th"t there is "

    $e#"ti2e re)"tio$shi3 9et6ee$ Ret0r$ o$ Asset "$+ C0rre$t R"tio7 There is " si#$iic"$t

    stro$# 3ositi2e re)"tio$shi3 9et6ee$ Ret0r$ o$ Asset "$+ So)2e$c! R"tio i7e7 @7(7 The

    re)"tio$shi3 9et6ee$ Lo"$ Loss 9! Tot") Lo"$s "$+ Ret0r$ o$ Asset is ")so $e#"ti2e "$+

    )o6 i7e7 @77 The re)"tio$shi3 9et6ee$ C0rre$t R"tio "$+ So)2e$c! R"tio is )o6 "$+

    $e#"ti2e i7e7 @7&7 B0t there is " si#$iic"$t stro$# 3ositi2e re)"tio$shi3 9et6ee$ Lo"$

    Loss 9! Tot") Lo"$s "$+ C0rre$t R"tio i7e7 @7&/7 There is " $e#"ti2e re)"tio$shi3

    ).

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    9et6ee$ So)2e$c! R"tio "$+ Lo"$ Loss 9! Tot") Lo"$s i7e7 @7-7 B! $e#"ti2e re)"tio$

    6e *e"$ th"t the 2")0e o o$e 2"ri"9)e 6i)) i$cre"se i the 2")0e o the seco$+ 2"ri"9)e is

    +ecre"se+ "$+ 2ice 2ers" "$+ 3ositi2e re)"tio$ *e"$s the 2")0e o o$e 2"ri"9)e 6i))

    i$cre"se i the 2")0e o seco$+ 2"ri"9)e is i$cre"se+7

    /a&le 49 4' Correlation $atriE >Bangladesh?

    Ret0r$ o$

    Assets

    C0rre$t R"tio So)2e$c!

    R"tio

    Lo"$ Loss

    Reser2es 9!

    Tot") Lo"$s

    Ret0r$ o$ AssetsPe"rso$ Corre)"tio$ & 7&' 7( 7/'

    Si#7 @t"i)e+ 7''' 7 7&N ' ' ' '

    C0rre$t R"tioPe"rso$ Corre)"tio$ 7&' & 7&( 7&(

    Si#7 @t"i)e+ 7''' 7'/& 7/'N ' ' ' '

    So)2e$c! R"tioPe"rso$ Corre)"tio$ 7( 7&( & 7'

    Si#7 @t"i)e+ 7 7'/& 7

    N ' ' ' 'Lo"$ Loss

    Reser2es 9! Tot")

    Lo"$s

    Pe"rso$ Corre)"tio$ 7/' 7&( 7' &

    Si#7 @t"i)e+ 7& 7/' 7N ' ' ' '

    7 Corre)"tio$ is si#$iic"$t "t the 7& )e2e) @t"i)e+7

    Corre)"tio$ *"tri> is #i2e$ i$ the "9o2e t"9)e "$+ is sho6s th"t the corre)"tio$

    9et6ee$ Ret0r$ o$ Asset "$+ C0rre$t R"tio is @7&' 6hich sho6s th"t there is "

    $e#"ti2e re)"tio$shi3 9et6ee$ Ret0r$ o$ Asset "$+ C0rre$t R"tio7 There is " si#$iic"$t

    stro$# 3ositi2e re)"tio$shi3 9et6ee$ Ret0r$ o$ Asset "$+ So)2e$c! R"tio i7e7 @7(7

    The re)"tio$shi3 9et6ee$ Lo"$ Loss 9! Tot") Lo"$s "$+ Ret0r$ o$ Asset is si#$iic"$t

    90t $e#"ti2e i7e7 @7/'7 The re)"tio$shi3 9et6ee$ C0rre$t R"tio "$+ So)2e$c! R"tio is

    )o6 "$+ $e#"ti2e i7e7 @7&(7 B0t there is " 3ositi2e re)"tio$shi3 9et6ee$ Lo"$ Loss 9!

    )/

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

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    Tot") Lo"$s "$+ C0rre$t R"tio i7e7 @7&(7 There is " stro$# $e#"ti2e "$+ " si#$iic"$t

    re)"tio$shi3 9et6ee$ So)2e$c! R"tio "$+ Lo"$ Loss 9! Tot") Lo"$s i7e7 @7'7 B!

    $e#"ti2e re)"tio$ 6e *e"$ th"t the 2")0e o o$e 2"ri"9)e 6i)) i$cre"se i the 2")0e o the

    seco$+ 2"ri"9)e is +ecre"se+ "$+ 2ice 2ers" "$+ 3ositi2e re)"tio$ *e"$s the 2")0e o o$e

    2"ri"9)e 6i)) i$cre"se i the 2")0e o seco$+ 2"ri"9)e is i$cre"se+7

    493 Panel .egression Analysis

    P"$e) re#ressio$ is " *etho+ 6hich 0ses 3"$e) +"t" to c")c0)"te res0)ts7 P"$e) +"t"

    co$sists o 9oth crosssectio$") "$+ ti*e series +"t"7 Cross sectio$") +"t" i$c)0+es r"tios,

    i$+i2i+0")s etc7 "$+ ti*e series i$c)0+es the $0*9er o !e"rs o2er 6hich the +"t" is

    o9ser2e+7

    /a&le 49 #' .egression >Pakistan?

    De3e$+e$t V"ri"9)e? ROA

    V"ri"9)e Coeicie$t St+7 Error tSt"tistic Pro97

    C 7/ 7&- '7('( 7CR 7&&/' 7-- /7//' 7SR 7&&- 7--' &7/&/' 7'LTL 7-'(( 7'''- (7(/(/ 7

    Rs;0"re+ 7/('-A+40ste+ Rs;0"re+ 7/-'&'[email protected]"tistic 7

    The "9o2e t"9)e te))s 0s "9o0t the res0)ts o the re#ressio$ "$")!sis7 Re#ressio$

    "$")!sis is " test 6hich te))s 0s "9o0t the re)"tio$shi3 9et6ee$ +e3e$+e$t "$+ i$+e3e$+e$t

    2"ri"9)es7 The re#ressio$ *o+e) is it 9ec"0se the 2")0e o 3ro9"9i)it! o Fst"tistics is

    77The 2")0e o A+40ste+ Rs;0"re+ is 7/('- 6hich *e"$s th"t /( o the ch"$#e

    i$ +e3e$+e$t 2"ri"9)e is +0e to the i$+e3e$+e$t 2"ri"9)e7 Pro9"9i)it! o e"ch 2"ri"9)e is

    7 6hich *e"$s th"t i 6e 3eror* the "$")!sis & ti*es, o0r res0)t 6i)) 9e the s"*e

    e2er! ti*e7 The 2")0e o co$st"$t is '7('( 6hich *e"$s th"t it is si#$iic"$t "$+ 6he$

    ),

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    e2er!thi$# re*"i$s 0$ch"$#e+ ROA 6i)) 9e "t 7/7 CR is si#$iic"$t "t /7//'

    6hich *e"$ th"t i 6e i$cre"se o$e 0$it o CR th"$ it 6i)) c"0se " +ecre"se o 7&&/'

    i$ ROA7 The 2")0e o SR is &7/&/' 6hich *e"$ th"t it is si#$iic"$t "$+ 6he$ o$e 0$it

    o SR is i$cre"se+ th"$ it 6i)) c"0se "$ i$cre"se o 7&&- i$ ROA7 LTL is si#$iic"$t

    "t (7(/(/ 6hich *e"$ th"t 6he$ o$e 0$it o LTL is i$cre"se+ it 6i)) c"0se "$ i$cre"se

    o 7-'(( i$ ROA7 The res0)t st"tes the Pro9"9i)it! @FSt"tistics o 7, 6hich is )ess

    th"$ 7/ 6hich *e"$s th"t the rese"rch "$+ the *o+e) is s033orti$# the re#ressio$

    "$")!sis7

    /a&le 49 :' .egression >Bangladesh?

    De3e$+e$t V"ri"9)e? ROA

    V"ri"9)e Coeicie$t St+7 Error tSt"tistic Pro97

    C 7&---/ 7( &7(' 7&&CR 7 7&(( &7-&& 7&-/SR -7' 7&( &7'&-(- 7-&LTL 7- 7&(&-- &/7(/ 7

    Rs;0"re+ 7(-

    A+40ste+ Rs;0"re+ 7/([email protected]"tistic 7

    The "9o2e t"9)e te))s 0s "9o0t the res0)ts o the re#ressio$ "$")!sis7 Re#ressio$

    "$")!sis is " test 6hich te))s 0s "9o0t the re)"tio$shi3 9et6ee$ +e3e$+e$t "$+ i$+e3e$+e$t

    2"ri"9)es7

    A+40ste+ RS;0"re+ sho6s the re)"tio$shi3 9et6ee$ the i$+e3e$+e$t 2"ri"9)es "$+

    +e3e$+e$t 2"ri"9)e7 The res0)ts o Re#ressio$ A$")!sis, sho6 the A+40ste+ Rs;0"re+ o

    7/(, 6hich *e"$s th"t / o ch"$#es i$ +e3e$+e$t 2"ri"9)e "re e>3)"i$e+ 9!

    i$+e3e$+e$t 2"ri"9)es7 The res0)ts o TSt"tistics sho6 th"t CR is i$si#$iic"$t 9ec"0se its

    tSt"tistics is &7(' 6hich )ess th"$ , 6here"s, SR "$+ LTL "re si#$iic"$t 9ec"0se

    )2

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    the! "re &7'&-(- "$+ &/7(/, res3ecti2e)!, 6hich is hi#her th"$ 7 Coeicie$t o

    2"ri"9)es sho6s th"t ho6 *0ch the +e3e$+e$t 2"ri"9)e ch"$#e, +0e to the i$cre"se or

    +ecre"se i$ the 0$its o the i$+e3e$+e$t 2"ri"9)es7 CR coeicie$t st"tes 7, 6hich

    *e"$s th"t, & 0$it +ecre"se i$ CR 6i)) i$cre"se the ROA 9! 77 SR coeicie$t

    st"tes 7'', 6hich *e"$ th"t, & 0$it i$cre"se i$ SR, 6i)) i$cre"se the ROA 9! -7'7

    LTL coeicie$t st"tes 7-, 6hich *e"$ th"t, & 0$it +ecre"se i$ LTL, 6i)) i$cre"se

    the ROA 9! 7-7 Pro9"9i)it! @FSt"tistics sho6s the si#$iic"$ce o o0r

    h!3othesis7 The res0)t st"tes the Pro9"9i)it! @FSt"tistics o 7, 6hich is )ess th"$ 7/

    6hich *e"$s th"t the rese"rch "$+ the *o+e) is s033orti$# the re#ressio$ "$")!sis7

    494 Comparison

    /a&le 49 7' Comparison &etween Pakistan and Bangladesh

    C. S. ,/,

    Pakistan Si#$iic"$t Si#$iic"$t Si#$iic"$t

    Bangladesh I$si#$iic"$t Si#$iic"$t Si#$iic"$t

    B! co*3"ri$# the res0)ts it 6"s o9ser2e+ th"t the i$+e3e$+e$t 2"ri"9)es, th"t "re

    C0rre$t R"tio, So)2e$c! R"tio "$+ Lo"$ Loss 9! Tot") Lo"$s, h"2e " si#$iic"$t

    re)"tio$shi3 6ith the +e3e$+e$t 2"ri"9)e @ROA, i$ P"5ist"$s c"se, 6here"s, i$

    B"$#)"+eshs c"se the o$)!, So)2e$c! R"tio "$+ Lo"$ Loss 9! Tot") Lo"$s h"2e "

    si#$iic"$t re)"tio$shi3 6ith the De3e$+e$t V"ri"9)e7

    )3

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    Chapter # D Conclusion

    The *"i$ 30r3ose o the st0+! is to e2")0"te, "$")!1e "$+ co*3"re the

    3eror*"$ce o B"$5s 9et6ee$ B"$#)"+esh "$+ P"5ist"$7 The st0+! is +o$e 0si$# o0r

    V"ri"9)es, B"$5 Peror*"$ce @6hich 6"s *e"s0re+ 9! ROA "s " De3e$+e$t V"ri"9)e

    "$+ C0rre$t R"tio, So)2e$c! R"tio "$+ Lo"$ Loss 9! Tot") Lo"$s "s I$+e3e$+e$t

    V"ri"9)es7 The st0+! sho6s ho6 the 9"$5 3eror*"$ce is "ecte+ 9! these 2"ri"9)es7 It

    sho6s ho6 stro$# the re)"tio$shi3 is 9et6ee$ these 2"ri"9)es7 The st0+! sho6s t6o

    +iere$t res3o$ses o t6o +iere$t co0$tries "$+ sho6e+ th"t ho6 9oth the 9"$5i$#sector o 9oth co0$tries #re6 o2er the 3"st !e"rs7

    I$ P"5ist"$

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

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    Chapter : = .ecommendations and -uture .esearch

    The *"i$ 30r3ose o this st0+! is to e2")0"te "$+ co*3"re the 9"$5i$# 3eror*"$ce o

    B"$#)"+esh "$+ P"5ist"$, thro0#h i$"$ci") r"tios7 Fo0r 2"ri"9)es 6ere 0se+ i$ this st0+!,

    B"$5 Peror*"$ce "s " De3e$+e$t V"ri"9)e "$+ C0rre$t R"tio, So)2e$c! R"tio "$+ Lo"$

    Loss 9! Tot") Lo"$s "s I$+e3e$+e$t V"ri"9)es7 The i$+i$#s o the rese"rch sho6s, th"t

    the i$+e3e$+e$t 2"ri"9)es, th"t "re C0rre$t R"tio, So)2e$c! R"tio "$+ Lo"$ Loss 9! Tot")

    Lo"$s, h"2e " si#$iic"$t re)"tio$shi3 6ith the +e3e$+e$t 2"ri"9)e @ROA, i$ P"5ist"$s

    c"se, 6here"s, i$ B"$#)"+eshs c"se the o$)!, So)2e$c! R"tio "$+ Lo"$ Loss 9! Tot")

    Lo"$s h"2e " si#$iic"$t re)"tio$shi3 6ith the De3e$+e$t V"ri"9)e7

    O$ the 9"sis o o0r i$+i$#s 6e s0##est th"t, si$ce the +"t" t"5e$ i$ this st0+! is

    o !e"rs, *ore "$+ 9etter rese"rch c"$ 9e +o$e 6ith 9i##er ti*e 3erio+7 Moreo2er, the

    rese"rch sho6s th"t the 9"$5s 3eror*"$ce is #etti$# 9etter "$+ the 3roit"9i)it! o 9"$5s

    is ")so i$cre"si$# th0s, 0rther st0+! sho0)+ 9e c"rrie+ o0t to 5ee3 the recor+ o the

    3ro#ress7 The rese"rch sho6s the i$"$ci") r"tios h"2e "$ i*3"ct o$ 9"$5 3eror*"$ce,

    th0s it is reco**e$+e+ th"t *ore "+2"$ce *etho+s o i$"$ci") r"tios sho0)+ 9e 0se+ )i5e

    CAMAL etc7 Accor+i$# to the res0)ts, C0rre$t r"tio sho6s $e#"ti2e re)"tio$shi3 6ith

    ROA, so it is reco**e$+e+ th"t 9oth co0$tries sho0)+ i*3ro2e their c0rre$t r"tio "$+

    *ore rese"rch sho0)+ 9e +o$e o$ this i$ ho6 to i*3ro2e the c0rre$t r"tio o the 9"$5s7

    )6

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    .eferences

    Abdul 4aheem8 A1 41 ')**/-1 4atio Analysis as a measure of

    performance in the #an9in Industry1Journal of the Department

    of Business Administration8 +.*0+/*1

    Abdulla8 (1 71 '+66/-1 An mpirical Analysis ;f &ommercial #an9s

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    #adreldin8 A1 M1 ')**6-1 %easuring the #erformance of "slamic Banks

    b Adapting 'onventional Ratios$&airo : Berman University in

    &airo1

    @r1 Zarou ;sman Muhammed8 @1 A1 ')*+/-1 %he Impact of

    International >inancial &risis on the Cciency of ;mani #an9s

    red =1 =ays8 S1 A1 ')**6-1 Cciency 4atios and &ommunity #an9

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    Md1 Ariful Islam8 M1 =1 ')*+.-1 inancial ;4MS1

    %araEneh8 M1 ')**2-1 A &omparison of >inancial

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    COMPARATIVE STUDY ON BANKS PERFORMANCE BETWEEN BANGLADESH

    AND PAKISTAN

    "nternational Research Journal of Finance and Economics8 +*+0

    ++)1

    UEunta @avid8 A1 F1 ')*+)-1 %he Structure of the Nierian #an9in

    Sector and its Impact on #an9