EconoQuantum ISSN: 1870-6622
[email protected] Universidad de Guadalajara México Chavarín Rodríguez, Rubén Determinants of Commercial Bank Profitability in Mexico EconoQuantum, vol. 12, núm. 1, 2015, pp. 97-123 Universidad de Guadalajara Zapopan, México Available in: http://www.redalyc.org/articulo.oa?id=125043458005 How to cite Complete issue Scientific Information System More information about this article Network of Scientific Journals from Latin America, the Caribbean, Spain and Portugal Journal's homepage in redalyc.org Non-profit academic project, developed under the open access initiative Determinants of Commercial Bank Profitability in Mexico Rubén Chavarín Rodríguez1 ■ Abstract. The aim of the present work is to identify the main determinants of profitability for commercial banks established in Mexico. A database of 45 banks representing virtually the whole world of commercial banking in the period 2007-2013 was used. Dynamic models using Arellano-Bover/Blundell- Bond estimators with an error that follows an MA(1) process were employed along with static models having random effects and Hausman-Taylor estimator. Findings suggest that the profitability of commercial banking is sustained by the level of capital, the charging of commissions and fees, and control of operating expenses, as well as certain market entry barriers and obstacles to competition that provoke a relatively high persistence of profitability. ■ Keywords: Bank profitability, Dynamic panel-data, Latin America. ■ JEL classification: G21, C23, L13, O54. ■ Resumen. El objetivo del presente trabajo es identificar los principales deter- minantes de la rentabilidad de la banca comercial establecida en México. Se ha utilizado una base de datos de 45 bancos que representan prácticamente todo el universo de la banca comercial en el periodo 2007-2013.