Evaluating the influence of corporate governance mechanisms and bank-specific factors on the performance of Nepalese commercial banks

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This purpose of the study is to evaluate the influence of corporate governance mechanism factors: board size, board independence, capital adequacy ratio, as well as bank-specific factors: dividend payout ratio and firm size, on the performance of Nepalese commercial banks. The study covered 10 years’ secondary data from 2013/14 to 2022/23, derived from the annual reports and websites of four selected commercial banks that were listed on the Nepal Stock Exchange: Kumari Bank Limited, Himalayan Bank Limited, Prabhu Bank Limited, and Prime Commercial Bank. A non-probability sample method, especially the purposive sampling approach, was used in this study. Earnings per share (EPS) is regarded to be the dependent variable, whereas two elements, namely, corporate governance mechanisms and bank-specific factors, are considered to be independent variables. Data analysis was carried out using the SPSS 25 software, which includes descriptive statistics, Pearson correlation, and multiple linear regression. The empirical results indicate that board size has a favorable influence on EPS, but this association does not reach statistical significance. In contrast, board independency has a notable and statistically significant negative impact on EPS. The capital adequacy ratio is positively correlated with EPS. However, the impact of firm size on EPS is not statistically significant. On the other hand, the dividend payout ratio has a significant positive effect on EPS.

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    • Figure 1. Conceptual framework
    • Table 1. Descriptive statistics
    • Table 2. Correlation matrix between variables
    • Table 3. Model summary
    • Table 4. ANOVA
    • Table 5. Regression analysis
    • Conceptualization
      Padam Dongol
    • Funding acquisition
      Padam Dongol
    • Investigation
      Padam Dongol
    • Methodology
      Padam Dongol
    • Software
      Padam Dongol
    • Validation
      Padam Dongol
    • Writing – original draft
      Padam Dongol
    • Data curation
      Sajeeb Kumar Shrestha
    • Formal Analysis
      Sajeeb Kumar Shrestha
    • Project administration
      Sajeeb Kumar Shrestha
    • Resources
      Sajeeb Kumar Shrestha
    • Supervision
      Sajeeb Kumar Shrestha
    • Visualization
      Sajeeb Kumar Shrestha
    • Writing – review & editing
      Sajeeb Kumar Shrestha