Abstract: This study attempts to estimate the relationship between return on equity (ROE) and four company-specific explanatory variables. We have taken data from the Islamic banking industry of Bangladesh. Our research period covers 2010–2016. Internal factors of this study are bank size, investment-to-deposit, non-performing investment and cost-to-income ratio. We have applied cross-section random effects model to measure the relationship between dependent and independent variables. Our estimation finds that investment-to-deposit have positive correlation with ROE and all other three variables have negative relationship with ROE. We have found statistical significance for investment-to-deposit and cost-to-income in the study.
S. M. Rifat Hassan (2019). Impact of Internal Factors on Banks’ ROE. International Conference on Business and Management, 534–537. Dhaka. ISBN: 978-984-344-3540.