Factors impact on the profitability of commercial banks in Vietnam: Empirical evidence in the period of 2006 - 2021

Abstract

This study aims to investigate the impact of some factors on the financial performance of commercial banks in Vietnam and the effec of the Covid-19 pandemic on these relationships. Using data from 37 commercial banks in Vietnam for the period from 2006 to 2021, the research results show that banks with greater equity ratio, size and ability to diversify sources of income have higher profitability. On the other hand, banks with high non-performing loan ratio have lower profitability than other banks. When considering these relationships in the context of the Covid-19 pandemic, the impact of bank size and bad debt on profitability is weakened, while the effect of income diversification is amplified during this period.