Corporate governance parties effect on private banks’ profitability: Panel fixed effect regression analysis

Abstract The banking disaster affects the monetary mechanism and economic system of a country. The aim of this article is to quantitatively examine the factors that affect the profitability of Ethiopian private commercial banks. In this study, the quantitative research approach, descriptive research design, and secondary data sources collected from the National Bank of Ethiopia for the period 2013 to 2022. The population of this study included all private commercial banks operating in Ethiopia. The findings of the panel fixed-effect regression analysis revealed that the profitability of the selected bank, as measured by return on assets, was significantly influenced by various factors including the size and capital adequacy ratio of the financial institution, control performance, legal reserve ratio, and liquidity ratio. The implications of these findings highlight the combined impact of macro and micro factors on the overall profitability of private commercial banks in Ethiopia.