The impact of EPS and the performance factors of banks and external banking activity with their credit rating and its impact on the country's inflation index

Abstract

Inflation is one of the structural problems of Iran's economy, which has affected the country's economic performance in the post-war period with double-digit rates until now. The banking system, as an important part of the economic performance, has been heavily affected by the inflationary conditions of the economy in all these years. Inflation reduces the real interest rate and increases the demand for loans.

In this article, based on time series data, the effects of inflation on banking performance in Iran in terms of deposit attraction, as well as the granting of foreign banking facilities and activities with their credit rating during the years 1368 to 1386 have been investigated. The information is obtained from the annual economic reports of the Central Bank, as well as the website of the Central Bank and the National Statistics Organization.

 The research method was regression analysis and correlation research using Eviews software. The findings indicate that although inflation has had a negative effect on the performance of the banking system and foreign banking activity as well as earnings per share (EPS) in attracting deposits and providing facilities, the correlation coefficient in most models was not significant. Is.

Therefore, it should be accepted that the government history of Iran over the past 28 years negates the causal relationship between the volume of deposits and the variables of bank interest and inflation. which conveys these two concepts, firstly, during the years when inflation was higher than the interest rate of deposits, however, the volume of deposits has increased, which means that the depositors have seen the saddle. There is no alternative to transfer people's deposits from banks to other markets. Secondly, it shows that other economic and non-economic factors have affected the volume of deposits.