DETERMINANTS OF SHARE PRICE OF NEPALESE COMMERCIAL BANKS

Abstract

The objective of this study is to identify the variables that affect Nepal's commercial banks' market price per share. This study examines the effects of leverage, bank size, dividend yield, earning per share, dividend payout ratio, and market price per share. This study used a comparative descriptive and causal research approach. Covering ten-year research period, from 2013–14 to 2022–23, this study is based on secondary data gathered from the published annual reports of sample banks, including EBL, HBL, SCBNL, NSBL, NABIL, and NMB. With the help of the software SPSS, the data are analyzed using descriptive statistics, correlation, multiple regression, t-tests, f-tests etc. The results of this analysis indicate that the market price per share and dividend payment ratio have a very weak positive link. In a similar vein, it demonstrates a strong positive correlation between market price per share and bank earnings per share. On the other hand, the market price per share and the banks' dividend yield has relatively little negative association. In a similar vein, there is a strong positive association between bank leverage and market price per share. On the other hand, the market price per share and bank size has a weakly negative association. The results of the multiple regression model indicate that the market price per share is significantly positively impacted by both the dividend payout ratio and earnings per share. The market price per share of the bank's stock is significantly impacted negatively by its dividend yield. On the other hand, the share price of Nepalese commercial banks is not significantly impacted by debt or bank size. This is why the market price per share of Nepalese commercial banks is significantly influenced by bank-related dividend factors.