Purpose

This study aims to explore the determinants (bank-specific, industry-specific and macroeconomic) of income diversification across interest income and non-interest income as well as for non-traditional income sources (non-interest income) from 2004–2005 to 2021–2022.

Design/methodology/approach

An unbalanced data set comprising 110 Indian commercial banks with 1480 observations is sampled in this study. Because of the bounded nature of the dependent variables (proxies of income diversification), the panel Tobit regression model is used.

Findings

The findings reveal that income diversification is positively influenced by bank size, technological advancements, cost–income ratio, return on assets, market competition and inflation in the economy. However, the decision to diversify income sources is adversely impacted by the capital ratio, GDP and financial intermediation ratio. Moreover, factors such as asset quality (loan loss provisions) and liquidity ratio do not directly influence the diversification strategies in the Indian banking industry.

Practical implications

The present study uses an extensive set of variables to provide insights into key factors for bank managers, regulators and policymakers to consider before developing diversification strategies.

Originality/value

To the best of the authors’ knowledge, this is the first study to examine the various bank-specific and macroeconomic determinants that affect income diversification in the Indian banking sector. The current study also investigates new variables such as technological advancements and a market concentration index for measuring competition, which have not been investigated in existing literature concerning bank income diversification in the Indian context.

中文翻译：

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收入多元化的决定因素：来自印度银行的经验证据

目的

本研究旨在探讨2004-2005年至2021年利息收入和非利息收入以及非传统收入来源（非利息收入）收入多元化的决定因素（银行特定、行业特定和宏观经济） –2022 年。

设计/方法论/途径

本研究对包含 110 家印度商业银行和 1480 个观察值的不平衡数据集进行了抽样。由于因变量（收入多样化的代理）的有界性质，因此使用面板 Tobit 回归模型。

发现

研究结果表明，收入多元化受到银行规模、技术进步、成本收入比、资产回报率、市场竞争和经济通胀的积极影响。然而，收入来源多元化的决定受到资本比率、GDP 和金融中介比率的不利影响。此外，资产质量（贷款损失拨备）和流动性比率等因素并不直接影响印度银行业的多元化战略。

实际影响

本研究使用大量变量来深入了解银行经理、监管机构和政策制定者在制定多元化战略之前需要考虑的关键因素。

原创性/价值

据作者所知，这是第一项研究影响印度银行业收入多元化的各种特定银行和宏观经济决定因素的研究。目前的研究还调查了新的变量，例如技术进步和用于衡量竞争的市场集中度指数，这些变量在印度背景下的银行收入多元化的现有文献中尚未进行研究。