International Journal of Commerce and Management Research

International Journal of Commerce and Management Research


International Journal of Commerce and Management Research
International Journal of Commerce and Management Research
Vol. 6, Issue 4 (2020)

The relationship between capital structure and performance of Nepalese commercial banks


Naba Raj Adhikari

This paper aims to examine the relationship between capital structure and financial performance of Nepalese commercial banks. The study used a sample of 14 commercial banks covering government owned, joint venture and private banks over the period 2013/2014– 2018/2019 with secondary sources of data. Regression analysis is used in the estimation of functions relating the return on assets (ROA) and earnings per share (EPS) with measures of capital structure. The results reveal a negative relation of ROA and EPS with capital structure (Debt/Equity). However, it shows a positive relationship of ROA and EPS with total assets (Size). The findings provide evidence in support of high-level equity capital employed in the capital structure of Nepalese commercial banks.
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