How Credit Portfolio Diversification Affects the Profitability of Vietnamese Commercial Banks

How Credit Portfolio Diversification Affects the Profitability of Vietnamese Commercial Banks

Huynh Viet Khai, Phan Thi Anh Nguyet, Phan Dinh Khoi, Chu Van Nam
ISBN13: 9781522596073|ISBN10: 1522596070|ISBN13 Softcover: 9781522596080|EISBN13: 9781522596097
DOI: 10.4018/978-1-5225-9607-3.ch012
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MLA

Khai, Huynh Viet, et al. "How Credit Portfolio Diversification Affects the Profitability of Vietnamese Commercial Banks." Corporate Governance Models and Applications in Developing Economies, edited by Otuo Serebour Agyemang, et al., IGI Global, 2020, pp. 237-255. https://doi.org/10.4018/978-1-5225-9607-3.ch012

APA

Khai, H. V., Nguyet, P. T., Khoi, P. D., & Nam, C. V. (2020). How Credit Portfolio Diversification Affects the Profitability of Vietnamese Commercial Banks. In O. Agyemang, A. Ansong, & B. Agyei-Mensah (Eds.), Corporate Governance Models and Applications in Developing Economies (pp. 237-255). IGI Global. https://doi.org/10.4018/978-1-5225-9607-3.ch012

Chicago

Khai, Huynh Viet, et al. "How Credit Portfolio Diversification Affects the Profitability of Vietnamese Commercial Banks." In Corporate Governance Models and Applications in Developing Economies, edited by Otuo Serebour Agyemang, Abraham Ansong, and Ben Kwame Agyei-Mensah, 237-255. Hershey, PA: IGI Global, 2020. https://doi.org/10.4018/978-1-5225-9607-3.ch012

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Abstract

This study analyzed the impact of credit portfolio diversification on the profitability by using the data of 20 Vietnam commercial banks from 2009 to 2015. The results from feasible generalized least squares (FGLS) estimation show that the strategy of diversifying the credit portfolio increased the profitability of commercial banks. In addition, the study also indicates that the positive correlation of the ratio of owners' equity, credit growth, liquidity, assets, inflation rate with the profitability while the increase in non-performing loan decreased the profitability of these commercial banks.

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