The effect of strategic decision fields on bank profitability

In this doctoral thesis, the effect of strategic decisions on banking sector profitability has been investigated. In this study, with an asset-liability management point of view, the impact of strategic decisions such as decisions on bank assets, liabilities, revenue and cost items on banks' profitability have been analyzed taking into consideration risk management and macroeconomic factors. The importance of the research is due to the fact that their practical use is taken into account while examining the quantitative factors related to bank profitability. The selected independent variables are banking sector-specific variables that affect the operating results in terms of asset-liability management. Within the scope of the research, data of 23 deposit banks, consisting of six-month periods between 2009 and 2021, were included in the analysis. Four different models were established in this study; The first two stages examine the relationship between independent variables which are yield on assets, cost of liabilities, personnel costs, operational costs and non-interest income and expense management and dependent variables which are return on assets and return on equity. The model that was created in the third stage investigates the relationship between dependent variable cost of funds (breakeven interest rate) and independent variables of total deposit rate, non-deposit resource rate, risk-free interest rate, average asset size, FX liabilities rate, currency risk, interest rate risk, credit risk and CBRT policy interest rate. After examining the research period as a whole, the relationship between the cost of funds and the independent variables in the economy's operating environment with an inflation level of more than 10% and less than 10% was analyzed through the control variable inflation. In the fourth stage, the yield on assets, which represents the income part of the first two models, was investigated as a dependent variable. The independent variables of this model are cash loans ratio, retail loans ratio, commercial loan diversification, average assets size and credit risk. The GDP growth rate was used as a control variable and after examining the research period as a whole, the effects of the variables were investigated for years 2009-2021 by dividing in two blocks: when economic growth was more than 4.9% (which is the average of the data period), and during the periods when it was less than 4.9%. Key Words: strategic decision, return on assets, return on equity, yield on assets, cost of liabilities