Determinants Of Commercial Banks’ Financial Stability: Evidence From Mena Countries

Abstract

This current study aims to estimate the factors that contribute to improving the financial stability of commercial banks that operate in MENA-States using a balanced panel dataset for a period of 10 years (2011 to 2020). A sample consists of 132 commercial banks. In general, the empirical analysis findings show that all the explanatory variables represented in financial indicators related to determinants can reliably achieve the banking industry's financial stability in the countries being studied. They are important indicators for predicting commercial banks' fiscal stability. Specifically, the empirical evidence indicates that the level of banking competition, banking efficiency, financial inclusion and the level of performance of commercial banks are positively correlated with the level of stability. The findings also show that the financial development measured by stock market capitalization is negatively impacting the level of banking stability