Dear all, I want to conduct a research on the determinants of capital structure of commercial Banks. Their capital structure is regulated by national Banks. So, is it recommended to conduct a study on this topic?
It depends on the research sample/population.
To what extent the national bank intervenes in determining capital structure of commercial bank?
This topic is extensively researched and hence it would be difficult to find question(s) that is/are not answered.
So try first to write your research question(s) and go through the literature to see if any of your research question(s) is/are not answered or addressed adequately.
For a master degree you may consider this topic but for a PhD you should be very careful before you go further.
Further, banks are totally different than other sectors as they operate at a very high level of leverage and you need to bear this in mind.
You can find a very good summary of research conducted in this area in a paper written by Frank and Goyal (2009).
"Frank, M. Z., & Goyal, V. K. (2009). Capital Structure Decisions: Which Factors are Reliably Important?. Financial Management • Spring 2009 • pages 1 - 37"
If you can't locate this paper, please contact me via email [email protected] and I will send it to you.
Depends on the laws involve in capital requirements of commercial banks in the country you are looking at.
True, the capital structure of banks is determined by central banks, but your research is like asking, "What informs central banks' determination of banks' C.S (in your particular geographical location of interest)?"
True, again, as Ismail Ahmed Hamad opined, this topic has been extensively researched, but maybe not in your country(ies) of interest.
Besides, finance is highly dynamic, factors aren't static & it's safe to assume that your study will be very current.
Your choice of variables will be important, & your analytical techniques too, especially if different from previous tools or new.
I'll advise that you follow your heart & proceed with the research.
God help you.
Yes! Imagine a banking institution without the knowledge of what is the best combination of their capital portfolio, and they need to know to enable them to make the right decision.
Yes. From both a ownership perspective as well as a risk perspective.
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