The Impact of Credit Risk Management on the Financial Performance of the Banks Listed on the Dhaka Stock Exchange: A Two-Step System Generalized Method of Moments Panel Data Analysis

Prior Bangladeshi studies on the relationship between credit risk management and financial performance of listed banks suffered from a dynamic endogeneity bias, which led to misleading conclusions. As result, this study examines impact Dhaka Stock Exchange for period 2011 2018. The equity multiplier ratio (EMR), capital adequacy (CAR), non-performing loan (NPL) ratio, interest coverage (ICR), provision losses total (PCLTC) are proxies management. characterizes banks' three perspectives: bank management, as indicated by return (ROE); market, Tobin's Q (TQ); shareholder value, economic value added (EVA-ln). sample comprises 29 30 banks, two-step system generalized method moments (GMM) model is used test hypotheses. This finds mixed results, i.e., none variables in study, with exception ICR, affect sampled equally each perspectives. Particularly, results show that ICR has significant positive all measures performance, whereas PCLTC no any measure performance. EMR ROE but does not TQ EVA-ln. CAR been shown improve while having an insignificant effect NPL negative