Project Plan: Analyzing Financial Performance and Bank Stock Price

This project plan focuses on analyzing the impact of financial performance on bank stock prices. The research aims to assess how financial performance metrics, such as Return on Assets (ROA) and Return on Equity (ROE), influence the stock price of a bank. The study will utilize secondary data from the National Stock Exchange (NSE) and employ multiple regression analysis to examine the relationship between independent variables (asset size, capital ratio, net loans, etc.) and the dependent variable, which is the stock price. The project includes clearly defined research questions, such as how financial performance affects stock prices, the changes influenced by financial performance maintenance, and the model used for calculating yields. The plan also references relevant academic literature supporting the research design and methodology.

IMPACT OF
FINANCIAL
PERFORMANCE
ON THE STOCK
PRICE OF A BANK

Significance of the research
• The aim of the research in the project plan is
to asses the impact of the financial
performance on the stock price of a bank.
• The share market dynamics are directly
influenced by the cost of earning per share,
returns on assets and bank age.

Source of secondary data
• National Stock Exchange
(NSE) is the source of the
secondary data for the
factors of stock price that has
been affected by the financial
performance of the bank.
• The secondary data is
observed by the help of the
multiple regression analysis
process.

Research questions
How financial performance does help in
gaining better stock price of a bank?
What are the changes that are affected by the
maintenance of financial performance for
making better stock price in the bank?
What is the model that is used for calculating
the yields due to the financial performance on
the revenue and stock price on the bank?

Dependent
&
Independent Variables
dependent
• Stock prices are the main
dependent variable of the
bank which highly depends
on the financial
performance of the bank.
• Return Of Assets and Return
Of Equity are also the
dependent variables of the
bank (Khadafi, Heikal &
Ummah, 2014).
independent
• The asset size, capital ratio, net
loans, deposits, asset diversity
and revenue of cost ratio are
known as thee independent
variable (Laeven, Ratnovski &
Tong, 2016).
• The independent variables of
the regression equation model
which are the liquidity,
profitability and valuation in the
market have impact on the price
variable of the stock.

References:
Laeven, L., Ratnovski, L., & Tong, H. (2016). Bank
size, capital, and systemic risk: Some international
evidence. Journal of Banking & Finance, 69, S25-
S34.
Khadafi, M., Heikal, M., & Ummah, A. (2014).
Influence analysis of return on assets (ROA), return
on equity (ROE), net profit margin (NPM), debt to
equity ratio (DER), and current ratio (CR), against
corporate profit growth in automotive in Indonesia
Stock Exchange. International Journal of Academic
Research in Business and Social Sciences, 4(12).