Work detail

The Czech banking sector: Determinants of Profitability

Author: Mgr. Daniel Hykl
Year: 2022 - summer
Leaders: Mgr. Magda Pečená Ph.D.
Consultants:
Work type: Finance, Financial Markets and Banking
Masters
Language: English
Pages: 104
Awards and prizes:
Link: https://dspace.cuni.cz/handle/20.500.11956/174105
Abstract: This thesis is concerned with Czech banking sector in 2015 – 2020 and its profitability. A set
of bank-specific and macroeconomic variables is tested for profitability determination effects
by a general profitability model estimated with system GMM, FE, and OLS methods, yearly
and quarterly data are used. The results indicate negative effects on bank profitability of the
following on both yearly and quarterly bases: capitalization, operational efficiency, and
inflation change, and positive effects on bank profitability of the following on both yearly and
quarterly bases: bank size and GDP growth. The thesis also analyzes quarterly changes in bank
assets, liabilities, and equity. The results indicate systematic drops of liabilities and assets
reported as of year-ends. Potential explanations are discussed along with suggestions for further
research as this study presents a complex set of insights, results, and experience ready to be
augmented with further efforts.
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