Bank Valuation: Key Determinants

Abstract

Article seeks to delineate the key variables that affect bank valuation through a regression analysis of bank specific and macro variables. Study covers 16 financial years from 2005 to 2020 and is further divided into four year cohorts. Overall result indicate that wage structure (whether IBA-union negotiated pay or not), CASA, Net NPA and GDP growth are the most significant variables affecting bank valuations. Analysis segregating the data into four time periods showed that wage structure is the consistent value influencer over time.