http://ar.cou.ac.bd:8080/xmlui/handle/123456789/239 2026-05-28T18:53:13Z 2026-05-28T18:53:13Z Sakir, Abu http://ar.cou.ac.bd:8080/xmlui/handle/123456789/240 2025-07-09T06:42:53Z 2025-05-26T00:00:00Z

Examining the Factors Influencing Financial Distress in State-Owned Commercial Banks in Bangladesh. Sakir, Abu Banking system plays a vital role for the economic development of Bangladesh. It is clear that a poor banking system can’t help the economic development in a country. This study examined the driving factors of financial distress of four state-owned bank using panel data consisted of ten years through 2015 to 2024.The objective of this study was to analyze the determinants of four state owned commercial banks in Bangladesh based on their financial characteristics and identify the determinants of performance exposed by the financial ratios. In addition, econometric model (multivariate regression analysis) by formulating a regression model was used to estimate the impact of capital adequacy, contingent liability, default risk, inflation, liquidity ratio, return on asset, return on equity on the nonperforming loan of these banks. Capital adequacy, contingent liabilities, default risk, inflation, liquidity ratio, return on asset and return on equity are taken as independent variables whereas non-performing loan is used as dependent variable in this study. The result shows that contingent liability and inflation has strong significant impact on financial distress on state-owned commercial banks of Bangladesh. Furthermore, the estimation results reveal that Nonperforming loans are significantly influenced by capital adequacy ratio, percentage of default loan, liquidity ratio and return on asset which can lead state-owned commercial banks to financial distress. The study found that SCBs in Bangladesh are facing financial distress basis on linear regression model. Therefore, the study suggests the regulatory authorities, including stakeholders and researchers to considering the findings of the study and to be more alert of the operations of SCB s in order to steps forward the performance of this sector as well development of the country in the coming future.

2025-05-26T00:00:00Z