Archives for Technical Sciences | 2026
Authors: Lan T.T.; Ha H.T.B.; Nguyet N.A.; Hai T.
DOI: 10.70102/afts.2026.1835.763
Journal: Archives for Technical Sciences
Year: 2026
Publisher: Technical institute of Bijeljina
Document Type: Article
Open Access: All Open Access; Gold Open Access
Cited by: 0
Profitability is considered an important indicator for the safety, efficiency, and sustainability of banking systems. The aim of the study is to remove the confusion concerning the effect of capital structure, operational efficiency, and non-interest income on the profitability of commercial banks in Vietnam. Utilizing quantitative research methods, dynamic table data modelling, and estimation through the systematic general moment method (sys-GMM). In this regard, the data has been gathered from 31 commercial banks in Vietnam, accounting for 451 observations during 14 years from 2010 to 2024. The results from the estimation of the research models apply the GMM method of the system that is relevant and reliable, as in both tests of Arellano–Bond and Hansen are fulfilled. The new findings reveal that both models have a positive and statistically significant sign of the coefficient of the first-order delay variable of the dependent variable in terms of the dynamics of the return. The coefficient of ROA(t− 1)is 0.322 with a p-value of 0.010, while the coefficient of ROE(t− 1)is 0.435 with a p-value of 0.007. This implies that the profitability of the bank is hereditary, that is, the past profitability has a positive impact on the current profitability. Interestingly, there is a nonlinear relationship between capital structure and profitability (U-shaped) and between non-interest income and profitability (U-shaped), but not particularly strong and stable across models, and the indirect relation between capital structure and profitability through operational efficiency is not identified. The bad debt ratio has a significant negative effect on profitability and indicates that asset quality is an important determinant of the profitability of the bank, thereby reflecting the credit risk. © 2026, Technical institute of Bijeljina. All rights reserved.
capital structure; commercial banking; non-interest income; operating efficiency; profit; Vietnam