Paper: arXiv 2311.08617

Authors: Anas Azzabi, Younes Lahrichi

Abstract

Banks’ performance is an important topic for both professionals and researchers. Given the important literature on this subject, this paper aims to bring an up-to-date and organized review of literature on the determinants of banks performance. This paper discusses the main approaches that molded the debate on banks performance and their main determinants. An in-depth understanding of these latter may allow on the one hand, bank managers and regulators to improve the sector efficiency and to deal with the new trends shaping the future of their industry and on the other hand, academicians to enrich research and knowledge on this field. Through the analysis of 54 studies published in 42 peer-reviewed journals, we show that despite the importance of the existent literature, the subject of bank performance factors did not reveal all its secrets and still constitute a fertile field for critical debates, especially since the COVID-19 and the increasingly pressing rise in power of digital transformation and artificial intelligence in general and FinTechs in particular. The study concludes by suggesting new promising research avenues.

Complexity vs Empirical Score

  • Math Complexity: 1.5/10
  • Empirical Rigor: 3.0/10
  • Quadrant: Philosophers — conceptual discussion, limited math and data

Why this score: This paper is a qualitative literature review analyzing 54 studies on bank performance determinants rather than an empirical or mathematical study. While it provides a well-organized and clear synthesis of existing research along with future directions (FinTech, COVID-19 impact), it lacks mathematical derivations, backtesting, or novel quantitative models.

Research Flowchart

  flowchart TD
    A[Research Goal: Analyze Bank Performance Determinants & Future Trends] --> B[Data Collection: 54 Studies from 42 Peer-Reviewed Journals]
    B --> C[Methodology: Systematic Literature Review & Determinants Analysis]
    C --> D[Synthesis: Internal, External, COVID-19 & FinTech/AI Factors]
    D --> E[Key Findings: Field Remains Dynamic & Imperfectly Understood]
    E --> F[Outcomes: Framework for Managers/Regulators & New Research Avenues]