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- Title
Comparative Analysis of Financial Performance of Asian - American Banks VS. The U.S. National Average and Association between the Financial Performance with the Firm Characteristics.
- Authors
Sung-Kyoo Huh; Jin, John; Lee, K. J.
- Abstract
The objectives of this paper are two folds: first, to examine whether Asian -- American banks perform better than the U. S. bank national average; second, to explore the determinants of net interest income, a financial performance measure, from savings and loan business of Asian - American banks. 9 Korean American banks, 7 Chinese American banks, and 2 Japanese American banks make this study sample. Net interest income, non-interest operating income, and other income were used as financial performance measures. Net interest income is the excess of interest revenues from all outstanding loans over interest expenses for all deposits. Non-interest operating income is the excess of total non-interest revenues over total non-interest expenses. Total noninterest revenues include revenues from fiduciary activities, service charges on deposit accounts, trading account gains & fees, and additional non-interest revenues. Total non-interest expenses include salaries, wages, and other employee benefits, premises & equipment expenses, and additional non-interest expenses. Other income is the excess of the sum of Net Interest Income and Non-interest Operating Income over net operating income. Non-interest operating income, other income, debt to equity ratio, and size were used as the firm characteristics of the Asian -- American bank in this study. The results from this study suggest that there is no significant difference in financial performance between Asian -- American banks and U. S. national average. The results also suggest that the debt to equity ratio has a significant -- negative association with net interest income, while other income has a significant -- positive association with net interest income.
- Subjects
ASIAN American banking industry; FINANCIAL performance; DEBT-to-equity ratio; BANK profits; WORKING capital; DEPOSIT accounts
- Publication
Pan-Pacific Journal of Business Research, 2021, Vol 12, Issue 2, p47
- ISSN
2155-8442
- Publication type
Article