An The Impact of Financial Crisis on the Profitability of the UK banks

The primary purpose of this study is to find out the impacts of the financial crisis on the profitability of UK banks by collecting and analyzing panel data from five well-known banks from 2003 to 2012. A quantitative research approach is applied to the study, and secondary financial data is analyzed using T-tests for all five UK banks. ROCE, ROA, LIQUIDITY, GEARING, ROSHF, and PBFIT are measured to determine the profitability performance of UK banks. The effect of capital adequacy, managerial efficiency, bank size, earning quality, loan performance, asset quality, and liquidity is also explained to have a better understanding of the profitability measures of the banks. The empirical results indicate that macroeconomic and microeconomic factors were the leading causes of the financial crisis after the US subprime mortgage in 2007. Secondary data is collected from different sources, including the banks' annual reports, and analyzed using descriptive statistics on the profitability of the five UK banks. T-tests are applied to have thorough information about the profitability performance of the banks. The data collected is from reliable sources, and efforts are made to minimize the risk of prejudice. The strategies used by the banks did little to prevent the losses, and effective policies must be adopted to avoid unexpected events such as financial crises in the future. The UK banking sector is severely affected by the financial crisis, and the main reasons for that are the irregularities within the banks and the greediness of the banks' management. The management bodies of the banks must endeavor to reinforce the recognized important factors, and government bodies should review the adopted policies to provide a safer financial environment to the banks