The Impact of the Debt Ratio, Total Assets, and Earning Growth Rate on WACC: Evidence from Nepalese Commercial Banks

Main Article Content

Prem Bahadur Budhathoki
Chandra Kumar Rai

Abstract

This study examined the impact of the debt ratio, total assets, and earnings growth rate on banks’ WACC. This study employed bank scope data of twenty-eight commercial banks during the single period of 2018. Altogether, there were 28 observations were made in the study. The ordinary least squares model was used to analyze the data. The results indicated that two predictor variables debt ratio and total assets significantly affected the bank’s WACC. But the predictor variable earnings growth rate did not significantly affect banks’ WACC. The results of this study could help bankers and policymakers to take effective action to reduce banks’ WACC.

Keywords:
debt ratio, total assets, earnings growth rate.

Article Details

How to Cite
Budhathoki, P. B., & Rai, C. K. (2020). The Impact of the Debt Ratio, Total Assets, and Earning Growth Rate on WACC: Evidence from Nepalese Commercial Banks. Asian Journal of Economics, Business and Accounting, 15(2), 16-23. https://doi.org/10.9734/ajeba/2020/v15i230210
Section
Original Research Article

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