Macroeconomic Factors Influencing Deposit Mobilization of Commercial Banks

Tatek Hailu

doi:doi:10.11648/j.ijfbr.20241004.11

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Macroeconomic Factors Influencing Deposit Mobilization of Commercial Banks

Tatek Hailu^*

Published in International Journal of Finance and Banking Research (Volume 10, Issue 4)

Received: 4 August 2024 Accepted: 3 September 2024 Published: 23 September 2024

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Abstract

Deposit mobilization plays a vital role in the operations of commercial banks, facilitating financial intermediation and fostering economic development. This study delves into the impact of key macroeconomic factors on the deposit mobilization performance of commercial banks within the context of a developing economy. Through the application of panel data regression analysis, the research explores the dynamics between deposit mobilization and various macroeconomic variables, including inflation, interest rates, real GDP, exchange rates, monetary supply, and GDP per capita. The results indicate that both inflation and the monetary supply (measured by the M2/GDP ratio) exert a statistically significant negative effect on deposit mobilization. Furthermore, the investment deposit ratio also demonstrates a notable negative relationship with deposit mobilization. Conversely, GDP per capita shows a marginally significant positive correlation with deposit mobilization. The study includes a thorough descriptive analysis of the macroeconomic environment, assessing trends in inflation, exchange rates, real GDP growth, interest rates, and the expansion of money supply. This contextual review highlights a mixed macroeconomic landscape characterized by both favorable and adverse factors, which likely impact the deposit mobilization performance of commercial banks. The findings from this research offer valuable insights for policymakers and stakeholders within the banking sector. By informing the development of strategic initiatives aimed at promoting financial inclusion, enhancing asset-liability management practices, and bolstering the resilience of the banking system, stakeholders can effectively address the identified macroeconomic determinants influencing deposit mobilization.

Published in	International Journal of Finance and Banking Research (Volume 10, Issue 4)
DOI	10.11648/j.ijfbr.20241004.11
Page(s)	64-73
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Deposit Mobilization, Macroeconomic Factors, Financial Inclusion, Economic Development

References

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Hailu, T. (2024). Macroeconomic Factors Influencing Deposit Mobilization of Commercial Banks. International Journal of Finance and Banking Research, 10(4), 64-73. https://doi.org/10.11648/j.ijfbr.20241004.11

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ACS Style

Hailu, T. Macroeconomic Factors Influencing Deposit Mobilization of Commercial Banks. Int. J. Finance Bank. Res. 2024, 10(4), 64-73. doi: 10.11648/j.ijfbr.20241004.11

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AMA Style

Hailu T. Macroeconomic Factors Influencing Deposit Mobilization of Commercial Banks. Int J Finance Bank Res. 2024;10(4):64-73. doi: 10.11648/j.ijfbr.20241004.11

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@article{10.11648/j.ijfbr.20241004.11,
  author = {Tatek Hailu},
  title = {Macroeconomic Factors Influencing Deposit Mobilization of Commercial Banks
},
  journal = {International Journal of Finance and Banking Research},
  volume = {10},
  number = {4},
  pages = {64-73},
  doi = {10.11648/j.ijfbr.20241004.11},
  url = {https://doi.org/10.11648/j.ijfbr.20241004.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijfbr.20241004.11},
  abstract = {Deposit mobilization plays a vital role in the operations of commercial banks, facilitating financial intermediation and fostering economic development. This study delves into the impact of key macroeconomic factors on the deposit mobilization performance of commercial banks within the context of a developing economy. Through the application of panel data regression analysis, the research explores the dynamics between deposit mobilization and various macroeconomic variables, including inflation, interest rates, real GDP, exchange rates, monetary supply, and GDP per capita. The results indicate that both inflation and the monetary supply (measured by the M2/GDP ratio) exert a statistically significant negative effect on deposit mobilization. Furthermore, the investment deposit ratio also demonstrates a notable negative relationship with deposit mobilization. Conversely, GDP per capita shows a marginally significant positive correlation with deposit mobilization. The study includes a thorough descriptive analysis of the macroeconomic environment, assessing trends in inflation, exchange rates, real GDP growth, interest rates, and the expansion of money supply. This contextual review highlights a mixed macroeconomic landscape characterized by both favorable and adverse factors, which likely impact the deposit mobilization performance of commercial banks. The findings from this research offer valuable insights for policymakers and stakeholders within the banking sector. By informing the development of strategic initiatives aimed at promoting financial inclusion, enhancing asset-liability management practices, and bolstering the resilience of the banking system, stakeholders can effectively address the identified macroeconomic determinants influencing deposit mobilization.
},
 year = {2024}
}

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TY  - JOUR
T1  - Macroeconomic Factors Influencing Deposit Mobilization of Commercial Banks

AU  - Tatek Hailu
Y1  - 2024/09/23
PY  - 2024
N1  - https://doi.org/10.11648/j.ijfbr.20241004.11
DO  - 10.11648/j.ijfbr.20241004.11
T2  - International Journal of Finance and Banking Research
JF  - International Journal of Finance and Banking Research
JO  - International Journal of Finance and Banking Research
SP  - 64
EP  - 73
PB  - Science Publishing Group
SN  - 2472-2278
UR  - https://doi.org/10.11648/j.ijfbr.20241004.11
AB  - Deposit mobilization plays a vital role in the operations of commercial banks, facilitating financial intermediation and fostering economic development. This study delves into the impact of key macroeconomic factors on the deposit mobilization performance of commercial banks within the context of a developing economy. Through the application of panel data regression analysis, the research explores the dynamics between deposit mobilization and various macroeconomic variables, including inflation, interest rates, real GDP, exchange rates, monetary supply, and GDP per capita. The results indicate that both inflation and the monetary supply (measured by the M2/GDP ratio) exert a statistically significant negative effect on deposit mobilization. Furthermore, the investment deposit ratio also demonstrates a notable negative relationship with deposit mobilization. Conversely, GDP per capita shows a marginally significant positive correlation with deposit mobilization. The study includes a thorough descriptive analysis of the macroeconomic environment, assessing trends in inflation, exchange rates, real GDP growth, interest rates, and the expansion of money supply. This contextual review highlights a mixed macroeconomic landscape characterized by both favorable and adverse factors, which likely impact the deposit mobilization performance of commercial banks. The findings from this research offer valuable insights for policymakers and stakeholders within the banking sector. By informing the development of strategic initiatives aimed at promoting financial inclusion, enhancing asset-liability management practices, and bolstering the resilience of the banking system, stakeholders can effectively address the identified macroeconomic determinants influencing deposit mobilization.

VL  - 10
IS  - 4
ER  -

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Author Information

Tatek Hailu

Department of Management and Economics, Dire Dawa University, Dire Dawa, Ethiopia

Contact Email

http://orcid.org/0009-0008-4189-5695

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APA Style

Hailu, T. (2024). Macroeconomic Factors Influencing Deposit Mobilization of Commercial Banks. International Journal of Finance and Banking Research, 10(4), 64-73. https://doi.org/10.11648/j.ijfbr.20241004.11

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ACS Style

Hailu, T. Macroeconomic Factors Influencing Deposit Mobilization of Commercial Banks. Int. J. Finance Bank. Res. 2024, 10(4), 64-73. doi: 10.11648/j.ijfbr.20241004.11

Copy | Download

AMA Style

Hailu T. Macroeconomic Factors Influencing Deposit Mobilization of Commercial Banks. Int J Finance Bank Res. 2024;10(4):64-73. doi: 10.11648/j.ijfbr.20241004.11

Copy | Download

@article{10.11648/j.ijfbr.20241004.11,
  author = {Tatek Hailu},
  title = {Macroeconomic Factors Influencing Deposit Mobilization of Commercial Banks
},
  journal = {International Journal of Finance and Banking Research},
  volume = {10},
  number = {4},
  pages = {64-73},
  doi = {10.11648/j.ijfbr.20241004.11},
  url = {https://doi.org/10.11648/j.ijfbr.20241004.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijfbr.20241004.11},
  abstract = {Deposit mobilization plays a vital role in the operations of commercial banks, facilitating financial intermediation and fostering economic development. This study delves into the impact of key macroeconomic factors on the deposit mobilization performance of commercial banks within the context of a developing economy. Through the application of panel data regression analysis, the research explores the dynamics between deposit mobilization and various macroeconomic variables, including inflation, interest rates, real GDP, exchange rates, monetary supply, and GDP per capita. The results indicate that both inflation and the monetary supply (measured by the M2/GDP ratio) exert a statistically significant negative effect on deposit mobilization. Furthermore, the investment deposit ratio also demonstrates a notable negative relationship with deposit mobilization. Conversely, GDP per capita shows a marginally significant positive correlation with deposit mobilization. The study includes a thorough descriptive analysis of the macroeconomic environment, assessing trends in inflation, exchange rates, real GDP growth, interest rates, and the expansion of money supply. This contextual review highlights a mixed macroeconomic landscape characterized by both favorable and adverse factors, which likely impact the deposit mobilization performance of commercial banks. The findings from this research offer valuable insights for policymakers and stakeholders within the banking sector. By informing the development of strategic initiatives aimed at promoting financial inclusion, enhancing asset-liability management practices, and bolstering the resilience of the banking system, stakeholders can effectively address the identified macroeconomic determinants influencing deposit mobilization.
},
 year = {2024}
}

Copy | Download

TY  - JOUR
T1  - Macroeconomic Factors Influencing Deposit Mobilization of Commercial Banks

AU  - Tatek Hailu
Y1  - 2024/09/23
PY  - 2024
N1  - https://doi.org/10.11648/j.ijfbr.20241004.11
DO  - 10.11648/j.ijfbr.20241004.11
T2  - International Journal of Finance and Banking Research
JF  - International Journal of Finance and Banking Research
JO  - International Journal of Finance and Banking Research
SP  - 64
EP  - 73
PB  - Science Publishing Group
SN  - 2472-2278
UR  - https://doi.org/10.11648/j.ijfbr.20241004.11
AB  - Deposit mobilization plays a vital role in the operations of commercial banks, facilitating financial intermediation and fostering economic development. This study delves into the impact of key macroeconomic factors on the deposit mobilization performance of commercial banks within the context of a developing economy. Through the application of panel data regression analysis, the research explores the dynamics between deposit mobilization and various macroeconomic variables, including inflation, interest rates, real GDP, exchange rates, monetary supply, and GDP per capita. The results indicate that both inflation and the monetary supply (measured by the M2/GDP ratio) exert a statistically significant negative effect on deposit mobilization. Furthermore, the investment deposit ratio also demonstrates a notable negative relationship with deposit mobilization. Conversely, GDP per capita shows a marginally significant positive correlation with deposit mobilization. The study includes a thorough descriptive analysis of the macroeconomic environment, assessing trends in inflation, exchange rates, real GDP growth, interest rates, and the expansion of money supply. This contextual review highlights a mixed macroeconomic landscape characterized by both favorable and adverse factors, which likely impact the deposit mobilization performance of commercial banks. The findings from this research offer valuable insights for policymakers and stakeholders within the banking sector. By informing the development of strategic initiatives aimed at promoting financial inclusion, enhancing asset-liability management practices, and bolstering the resilience of the banking system, stakeholders can effectively address the identified macroeconomic determinants influencing deposit mobilization.

VL  - 10
IS  - 4
ER  -

Copy | Download