Spaseska, Tatjana and Karadjova, Vera (2026) BANK-SPECIFIC AND MACROECONOMIC DETERMINANTS ON MARKET CAPITALIZATION: EVIDENCE FROM MACEDONIAN LISTED BANKS. In: Proceedings / XIV International conference Economy, business & society in digitalized environment (EBSiDE 2026). Faculty of economy - Prilep, Prilep, pp. 421-435. ISBN ISBN 978-9989-695-85-8
Full text not available from this repository.Abstract
This study investigates the determinants of market capitalization of listed banks on the Macedonian Stock Exchange over the period 2023–2025. Using a balanced panel dataset consisting of seven banks, the research examines the impact of bank-specific financial indicators and macroeconomic variables on market valuation. Two econometric models are estimated. The first model analyzes the determinants of return on assets (ROA), while the second and main model focuses on the determinants of market capitalization measured in logarithmic form. The explanatory variables include profitability (ROA), financial leverage (total liabilities to total assets), and macroeconomic factors such as GDP growth and inflation. The empirical results indicate that ROA is the only statistically significant determinant of market capitalization, suggesting that profitability is the primary factor influencing bank valuation in the Macedonian banking sector. In contrast, leverage and macroeconomic variables are found to be statistically insignificant within the observed period. The results further show that ROE is highly correlated with ROA, indicating potential multicollinearity and reinforcing the decision to exclude it from the final market valuation model.
Overall, the findings suggest that bank market capitalization is predominantly driven by internal performance indicators rather than macroeconomic conditions. The study contributes to the literature on banking sector valuation in emerging markets by providing empirical evidence from the Macedonian Stock Exchange.
| Item Type: | Book Section |
|---|---|
| Subjects: | Scientific Fields (Frascati) > Social Sciences > Economics and Business |
| Divisions: | Faculty of Tourism and Hospitality |
| Depositing User: | Prof. d-r Vera Karadjova |
| Date Deposited: | 06 Nov 2026 14:08 |
| Last Modified: | 06 Nov 2026 14:08 |
| URI: | https://eprints.uklo.edu.mk/id/eprint/11959 |
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