Expected Result

Dependent variable

Return on assets (ROA )

Net income after tax as percentage of total assets (%)

Return on equity (ROE)

Net income after tax as percentage of shareholders’ equity (%)

Total Asset Growth (TA)

The percentage

change in total assets from current quarter t -

2 to previous quarter t − 1 minus 1

Independent variable

Real GDP Growth (RGDP)

It is a measure of total economic activity/performance within an economy. The economic growth is measured as the quarterly change in real Jamaican GDP


Control Variables

Bond Yields (GBY)

Bond Yields are represented

by the 1 year GOJ Bond Yields


Interest rate (IR)

Interest rates are represented

by the 180-day GOJ Treasury bill rate


Stock Market Growth (Changes in Main Index) (JSEM)

Growth was measured by using the daily returns of three months and finding the average returns for the quarter.


Unemployment Rate (UR)

The number of unemployed as a percentage of the labor force (the sum of the employed and unemployed)