Impact Of Global Financial Crisis On The Performance Of Commercial Banks Of Pakistan –A Case Study Of MCB Bank Limited
Author(s)
Dr.Faiz Muhammad Shaikh , Prof Dr Najma , Dr.Munawwar Ali Kartio , Albeena Mirza ,
Download Full PDF Pages: 116-126 | Views: 337 | Downloads: 109 | DOI: 10.5281/zenodo.3469353
Abstract
Objectives:
The objective of study is to investigate the effect of global financial crisis on the efficiency & performance of MCB bank Ltd. The crisis were basically started in United States after the collapse of subprime mortgage market but engulfed the entire globe though the level of severity was different from country to country
Data Collection Methodology:
Data were collected from various secondary sources and data were analyzed by using various financial ratios meant for liquidity, profitability & solvency. The banks play an important role of financial intermediation; channelize savings of public to investors hence basic key performance indicators for this research were deposits, profit, advances and capital
Objectives:
The objective of study is to investigate the effect of global financial crisis on the efficiency & performance of MCB bank Ltd. The crisis were basically started in United States after the collapse of subprime mortgage market but engulfed the entire globe though the level of severity was different from country to country
Data Collection Methodology:
Data were collected from various secondary sources and data were analyzed by using various financial ratios meant for liquidity, profitability & solvency. The banks play an important role of financial intermediation; channelize savings of public to investors hence basic key performance indicators for this research were deposits, profit, advances and capital
Results/Findings:
An attempt has been made to examine the growth and sustainability of sample bank through its performance from 2003 to 2012, before and after crisis. The main findings are (I) the profitability was affected adversely (II) Non Performing Loans were increased significantly after tight control and management for several years. (III) It was explored that costly deposits were mobilized to maintain the book size and restore the confidence of depositors and all stake holders. (IV)The stability of the system remained unquestionable due to maintenance of Capital Adequacy Ratio well above the targeted ratio of 8 % in terms of Basel accord.
Practical Implications:
This research attempts to address the issue of banking crisis and has practical implication in the Pakistani banking industry.An attempt has been made to examine the growth and sustainability of sample bank through its performance from 2003 to 2012, before and after crisis. The main findings are (I) the profitability was affected adversely (II) Non Performing Loans were increased significantly after tight control and management for several years. (III) It was explored that costly deposits were mobilized to maintain the book size and restore the confidence of depositors and all stake holders. (IV)The stability of the system remained unquestionable due to maintenance of Capital Adequacy Ratio well above the targeted ratio of 8 % in terms of Basel accord.
Practical Implications:
This research attempts to address the issue of banking crisis and has practical implication in the Pakistani banking industry.
Keywords
Global Financial Crisis, Commercial Banks, Deposits, Liquidity, profitability, Non Performing Loans
References
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