DETERMINATION OF MACROECONOMIC VARIABLES AFFECTING COMMERCIAL BANKS’ RETURN ON ASSETS

This study intended to ascertain the macroeconomic components affecting commercial banks’ asset profitability in Turkey. In this framework, for 2009-2016 period the possible interactions between sectoral average return on assets(ROA), calculated by using the financial data of eleven banks selected from the BIST-bank index, and inflation rate, interest rate, economic growth rate, USD rate, as macroeconomic variables, were examined. Because of its ability of adopting to different data structures and architectural flexibility, the Multivariate Adaptive Regression Splines (MARS) method was preferred in this study. It was figured out that the inflation rate and exchange rate had an effect on ROA. Accordingly, inflation increases the ROA up to the threshold value, which, after exceeding this point, has an effect in reducing the ROA of the banks. The increase in the nominal dollar exchange rate contributes to ROA of the banks increasingly, while the contribution to ROA of the banks exceeding the threshold value is fixed