The impact of investments' diversification on the financial performance of Jordanian commercial Banks

Abstract EN

This study aims to investigate the impact of investments' diversification on the financial performance of Jordanian commercial banks listed on the Amman stock exchange.

the study conduct on the overall thirteen Jordanian commercial banks listed on the Amman stock exchange in a period of ten years (2010-2019), where the researchers determines the direct and the indirect investment as independent variables, while return on assets and return on equity considered to be as dependent variables.

in addition the bank size and leverage were treated as control variables.

data were collected from the annual reports and financial statements of Jordanian commercial banks and analyzed by using e-views software.

this study concluded a positive significant impact of real state on the banks ROA.

a negative significant impact of industry and mining on the banks ROA.

diversification of direct investments real state, industry and mining has insignificant impact on banks roe in presence of control variables; size and leverage.

diversification of indirect investments has no statistically significant impact on banks ROA.

diversification of indirect investments bonds and stocks has insignificant impact on banks roe in presence of control variables; size and leverage.