The Influence of the Bank Restructuring on the Financial Performance of Commercial Banks in Iraq

Abstract

This study analyzes how Bank Restructuring in Iraq has impacted the financial performance of banks. Information collected from 2014–2020 is analyzed quantitatively using correlation and multiple regression with a sample size of six banks from the Iraq stock exchange to determine how Bank Restructuring has affected Iraqi bank performance. These findings show that the Capital Ratio (CR) affects bank performance in a negative way that is statistically significant. In contrast, the Bad Debt Ratio (BDR) has the opposite impact on bank performance. The Bank Restructuring (Debt ratio (DR)) also deleteriously affects bank performance. Based on the results, it is evident that both the accounts payable and capital structures need to be restructured. Increasing the amount of owners' capital money while decreasing the amount of payables, lowering the amount of bad debt, and increasing the requirements for credit quality would be beneficial to improving financial performance.

Keywords: CR, BDR, DR, Financial Performance.

DOI: 10.7176/RJFA/13-14-09

Publication date:August 31^st 2022