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Non-interest Income and Bank Profitability

Date created
2011-08
Authors/Contributors
Author (aut): Yang, Zhuofan
Author (aut): Wu, Mingfeng
Abstract
In the U.S. commercial banking systems, non-interest income contributes to as much as over 40% of net operating income, compared to only 20% in 1980, which demonstrates non-interest income is playing a very important role. To test how non-interest income affects U.S. commercial banks’ profitability for recent decade, we accepted accounting ratios to measure the links between non-interest income and other factors contributing to the bank profitability from 2000 to 2010. The results show that banks with higher non-interest income normally have stronger power of profitability. It also indicates that the impact of non-interest income on bank performance can be different, depending on how performance is measured. Thus it can be a helpful complimentary for nowadays non-interest income research.
Document
Description
FRM Project-Simon Fraser University
Copyright statement
Copyright is held by the author(s).
Permissions
You are free to copy, distribute and transmit this work under the following conditions: You must give attribution to the work (but not in any way that suggests that the author endorses you or your use of the work); You may not use this work for commercial purposes.
Scholarly level
Peer reviewed?
No
Language
English
Download file Size
FRM 2011 Zhuofan Yang and Mingfeng Wu.pdf 235.27 KB

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