The influence of the global financial crisis on the bank’s profitability: A spatial analysis
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Yasameen Tareq Mohammed Al-Khayyat, Batool Ismael Hasan Al-Husseini, Muna Jabbar Mohammed, Hussein Kadhim Sharaf 
This work is licensed under a Creative Commons Attribution 4.0 International License.
Abstract
In this study, the banking industry has faced as a consequence of a series of crises that have happened all over the world, this study reveals that the banking sector is under a tremendous deal of pressure to streamline its operations. This study uses spatial econometric methods to examine the impact of the global financial crisis (GFC) on banks’ profitability across regions. A panel dataset is analyzed, considering spatial dependence and spillover effects. The spatial lag model captures regional interactions, with robustness checks using alternative spatial weight matrices. Due to the combination of low interest rates and high capital levels, several financial institutions have been unable to successfully expand their profits since the GFC (Bashiru et al., 2023). In this study, the factors, both internal and external, that have an effect on the profitability of Iraqi banks are under investigation. The repercussions of the worldwide financial crisis are among the concerns that are being investigated as part of this examination among other things. The research was carried out was carried out in light of these statements. This research presents an empirical technique for investigating the matter, which follows the identification of factors found in prior studies on profitability.
Keywords: Financial Crisis, Iraqi Bank, Iraq Money Market, Net Profitability
Authors’ individual contribution: Conceptualization — Y.T.M.A.-K., B.I.H.A.-H., and M.J.M.; Methodology — M.J.M.; Investigation — Y.T.M.A.-K. and H.K.S.; Resources — Y.T.M.A.-K., B.I.H.A.-H., and M.J.M.; Writing — Y.T.M.A.-K., B.I.H.A.-H., and M.J.M.; Supervision — H.K.S.; Funding — M.J.M.
Declaration of conflicting interests: The Authors declare that there is no conflict of interest.
JEL Classification: D0, M0, M1, M5
Received: 16.02.2024
Accepted: 27.01.2025
Published online: 30.01.2025
How to cite this paper: Al-Khayyat, Y. T. M., Al-Husseini, B. I. H., Mohammed, M. J., & Sharaf, H. K. (2025). The influence of the global financial crisis on the bank’s profitability: A spatial analysis. Risk Governance and Control: Financial Markets & Institutions, 15(1), 110–118. https://doi.org/10.22495/rgcv15i1p11
