This research investigates how the Covid-19 pandemic affected the financial performance of commercial banks in Vietnam over the period of 10 years, from 2012 to 2021. For this purpose, the study utilized a balanced panel dataset of twenty-four commercial banks together with fixed effect and random effect model. Bank performance measured by return on assets finds strong evidence that Covid-19 positively impacts the performance of commercial banks. This study also finds a negative relationship between cost to income ratio and return on assets of listed banks, whereas the opposite trend was obtained for net interest margins, consumer price index, and size. However, the estimated results find that non-performing loans and loan to deposit ratio have no impact on commercial banks' performance during this period. Moreover, the crisis imposes a consistently positive and significant influence on small-size banks' profitability, but there is almost no visible effect on large-size commercial banks.

LIST OF TABLES iii
LIST OF FIGURES iv
ABSTRACT v
CHAPTER 1: INTRODUCTION 1
1.1. Background 1
1.2. Research problem 2
1.3. Research questions 4
CHAPTER 2: LITERATURE REVIEW 5
2.1. Covid-19 and sector performance 5
2.2. Bank performance during the crisis 6
2.3. Hypothesis development 6
2.4. Bank characteristics 7
CHAPTER 3: METHODOLOGY 11
3.1. Sample collection 11
3.2. Dependent variable 13
3.3. Independent variables 13
3.3.1. Explanatory variable 13
3.3.2. Bank-specific control variables 13
3.3.3. Macroeconomics variable 14
3.4. Research framework and proposed model 14
3.5. Estimation method 16
CHAPTER 4: EMPIRICAL RESULTS 17
4.1. Descriptive statistics 17
4.2. Correlation matrix and multicollinearity 18
4.3. Testing for choosing model, autocorrelation, and heteroscedasticity 20
4.4.1. The impact of Covid-19 on bank performance 22
4.4.2. The impact of Covid-19 on different sized-banks 25
CHAPTER 5: CONCLUSION 28
5.1. Summary 28
5.2. Recommendations 29
5.3. Limitations and suggestions for further research 29
REFERENCES 31
APPENDIX. 39

Adusei, M. (2015). The impact of bank size and funding risk on bank stability. Cogent Economics and Finance, 3(1), 1111489.
Agustina, D. O., and Kennedy, P. S. J. (2016). The effect of bank's performance on return on asset. Fundamental Management Journal, 1(1), 1-13.
Al-Awadhi, A.M., Alsaifi, K., Al-Awadhi, A., and Salah, A. (2020). Death and contagious infectious diseases: Impact of the COVID-19 virus on stock market returns. Journal of Behavioral and Experimental Finance, 27, 100326.
Alam, M.M., H.T., Wei, and Wahid, A. N. M. (2020). COVID-19 outbreak and sectoral performance of the Australian stock market: An event study analysis. Australian Economic Papers, 16, 1-14.
Albulescu, C. T. (2020). Coronavirus and financial volatility: 40 days of fasting and fear.
https://doi.org/10.48550/arXiv.2003.04005.
Aldasoro, I., Fender, I., Hardy, B. and Tarashev, N. (2020). Effects of COVID-19 on the banking sector: the market’s assessment. BIS Bulletin, 12(12), 1-9.
Ali, M.U., Saliha G. A., Faraz A.A., Mazhar A., Shakeelsarwar, O., and Ghulam D. (2020). Impact of Covid-19 on liquidity of the banking sector of Pakistan-Palarch’s. Journal of Archaeology of Egypt/Egyptology, 17(4), 2083-2106.
Altăr, A., Kubinschi, M., and Zaharia, A. (2021). Uncovering the dynamic relationship between credit and sustainable economic growth in selected CEE Countries. Sustainability, 13, 6349.
Anggono, H. (2017). The determinant factors of asset and liability management and the bank performance: an empirical study on foreign exchange commercial banks in Indonesia from 2008 to 2013. International Journal of Business and Globalization, 19(4), 512-527.
Asteriou, D. and Hall, S.G. (2011). Applied Econometrics. 2nd Edition. New York: Palgrave Macmillan.
Athanasoglou, P., Brissimis, S., and Delis, M. (2008). Bank-specific, industry-specific and macroeconomic determinants of bank profitability. Journal of International Financial Markets, Institutions and Money, 18, 121-136.
Babar, H. Z., and Zeb, G. (2011). CAMELS rating system for banking industry in Pakistan: Does CAMELS system provide similar rating as PACRA system in assessing the performance of banks in Pakistan? Umea School of Business, Umea Universitet.
Balango, T. K., and Rao, K. (2017). The effect of NPL on profitability of banks with reference to commercial bank of Ethiopia. Business and Management Research Journal, 7(5), 45–50.
Baret S., Celner A., O’Reilly M., and Shilling, M. (2020). COVID-19 potential implications for banking and capital markets sector. Deloitte Insights.
Barua, B., and Barua, S. (2020). COVID-19 implications for banks: the case of an emerging economy. SN Business Economics Journal, 1(19), 1-28.
Beck, N., and Katz, J. N. (1995). What to do (and not to do) with time-series cross-section data. American political science review, 89(3), 634-647.
Beltratti, A., and Stulz, R. M. (2012). The credit crisis around the globe: Why did some banks
perform better? Journal of Financial Economics, 105(1) 1-17.
Berger, A., and Humphrey, D. (1987). The effect of the firm’s capital structure on the systematic risk of common stocks. Journal of Finance, 27(2), 435-452.
Bhagat, S., Brian, B., and Jun, L. (2015). Size, leverage, and risk-taking of financial institutions. Journal of Banking and Finance, 59(5), 20-37.
Bikker, J. A. (1999). Efficiency in the European banking industry: an exploratory analysis to rank countries, research series supervision. Netherlands Central Bank, Directorate Supervision.
Bobade, P., and Alex, A. (2020). Study the Effect of Covid-19 in Indian banking sector. Journal NX, 179-184.
Casu, B., Girardone, C., and Molyneux, P. (2006). Introduction to banking (Vol. 10). Pearson education.
Chandani, A., Mehta, M., and Chandrasekaran, K. B. (2014). A working paper on the impact of gender of leader on the financial performance of the bank: A case of ICICI bank. Procedia Economics and Finance, 11, 459–471.
Damak, M., Freue, C., Chugh, G., Yalovskaya, N., Tan, M., and Tan, I. (2020). Banks in emerging markets 15 countries, three COVID-19 shocks. SandP Global.
Dang, U. (2011). The CAMEL Rating system in banking supervision: a case study of Arcada. Master thesis, Arcada University of Applied Sciences.
Dinc, Y. (2016). Islamic price index offer and effects of consumer price index on Islamic banks. MPRA Paper 85334. University Library of Munich, Germany.
Douglas, E., Lont, D., and Scott, T. (2014). Finance company failure in New Zealand during 2006-2009: predictable failures? Journal of Contemporary Accounting and Economics, 10(3), 277-295.
Do, H.L. (2020). Effects of Covid-19 on the bank performance: Difficulties and Solutions. Journal of Banking, 8/2020. (in Vietnamese).
Duan, Y., El Ghoul, S., Guedhami, O., Li, H., and Li, X. (2021). Bank systemic risk around COVID-19: A cross-country analysis, Journal of Banking and Finance, 133, 106299.
Duc, N.A., Nguyen, T.T.T, and Nguyen, H. C. (2020). The impact of crude oil and Covid-19 pandemic on business operations of PetroVietnam. Petrovietnam Journal, 11, 26-36.
Egger, P. (2002). An econometric view on the estimation of gravity models and the calculation of trade potentials. The World Economy, 25(2), 297–312.
Elyor, S. (2009). Factors affecting the performance of foreign banks in Malaysia. Master thesis. University Utara Malaysia.
Golin, J. (2001). The bank credit analysis handbook: A guide for analysts, bankers and investors. John Wiley and Sons Pre Ltd.
Government of Vietnam. (2020). Directive 11/ CT-TTg, of the Prime Minister on urgent tasks and solutions to remove difficulties for production and business, ensure social security inresponse to Covid-19.
Gujarati, D. N., and Porter, D. C. (2009). Basic Econometrics. 5th edition. New York: McGraw-Hill/Irwin.
Guru, B. K., Staunton J., and Balashanmugam B. (2002). Determinants of commercial bank profitability in Malaysia. Journal of Money, Credit, and Banking, 17, 69-82.
Halkos, G.E. and Salamouris, D.S. (2004). Efficiency measurement of the Greek commercial banks with the use of financial ratios: a data envelopment analysis approach, Management accounting research, 15(2), 201-224.
Hardiyanti, W., Febriatmoko, B., and Wulandari, S. (2016). Effect of LDR and BOPO on ROA with NIM as the intervening variable: Studies on commerciak banks in Indonesia for the period 2011 - 2013. Dinamika Akuntansi, Keuangan dan Perbankan, 5(2), 155-166.
Haron, S. (2004). Determinants of Islamic bank profitability, Global journal of finance and economics, 1(1), 11-33.
Harun, U. (2016). The influence of financial ratios CAR, LDR, NIM, BOPO, NPL to ROA. Journal Riset Bisnis dan Manajemen, 4(1), 67-82.
Hassan, K. and Bashir, M. (2003). Determinants of Islamic banking profitability. In 10th ERF annual conference, Morocco, 7, 2-31.
He, P., Sun, Y., Zhang, Y., and Li, T. (2020). COVID-19’s impact on stock prices across different sectors - An event study based on the Chinese stock market. Emerging Markets Finance and Trade, 56(10), 2198–2212.
Hoechle, D. (2007). Robust standard errors for panel regressions with cross-sectional dependence. The Stata journal, 7(3), 281-312.
IMF. (2009). Lessons of the global crisis for macroeconomic policy. IMF Staff Paper No. 09/37. Washington, DC: International Monetary Fund.
IMF. (2021). World Economic Outlook 2021; International Monetary Fund: Washington, DC, USA, 2021.
Jaffar, M., and Manarvi, I. (2011). Performance comparison of Islamic and conventional banks in Pakistan. Global Journal of Management and Business Research, 11(1), 59-66.
Kelecic, P. (2020). Covid-19 crisis: Opportunity for banks to reshape service models and foster digital transformation. International Journal of Contemporary Business and Entrepreneurship, 1(1), 50 – 61.
Kennedy, P. (2008). A Guide to Econometrics. Malden, MA: Blackwell Publishing.
Korzeb, Z. and Niedziołka, P. (2020). Resistance of commercial banks to the crisis caused by the COVID-19 pandemic: the case of Poland. Quarterly Journal of Economics and Economic Policy, 15(2), 205-234.
Liu, J., and Pariyaprasert, W. (2014). Determinants of bank performance: The application of the CAMEL model to banks listed in China’s stock exchanges from 2008 to 2011. AU-GSB e-Journal, 7(2), 80-95.
Majeed, S., Iftikhar, S.F. (2020). Modeling the relationship between banking sector credit and economic growth: A sectoral analysis for Pakistan. Journal of Economic Cooperation and Development, 41(1), 145-178.
Mazur, M., Dang, M., and Vega, M. (2020). COVID-19 and the march 2020 stock market crash. Evidence from SandP1500. Finance Research Letters, 38, 101690.
Narayan, P. K., and Phan, D. H. B. (2020). Country responses and the reaction of the stock market to COVID-19 - a preliminary exposition. Emerging Markets Finance and Trade, 56(10), 2138–2150.
Nguyen, C. T., Hai, P. T., and Nguyen, H. K. (2021). Stock market returns and liquidity during the Covid-19 outbreak: evidence from the financial services sector in Vietnam. Asian journal of Economics and Banking.
Nguyen, N. P. (2011). An overview of the financial situation in Vietnamese joint stock commercial banks. Journal of Economics and Development, 3(1), 77-86.
Nimalathasan, B. (2008). A comparative study of financial performance of banking sector in Bangladesh - an application of CAMELS rating system. Economic and Administrative Series, 2, 141-152.
Olweny, T., and Shipho, T. M. (2011). Effects of banking sectoral factors on the profitability of commercial banks in Kenya. Economics and Finance Review, 1(5), 1-30.
Pandey, D. K., and Kumari, V. (2021). Event study on the reaction of the developed and emerging stock markets to the 2019-nCoV outbreak. International Review of Economics and Finance, 71, 467- 483.
Pasiouras, F., and Kosmidou, K. (2007). Factors influencing the proftability of domestic and foreign commercial banks in the European Union. Research in International Business and Finance, 21(2), 222-237.
Patwary and Tasneem. (2019). Impact of non-performing loan on profitability of banks in Bangladesh: A study from 1997 to 2017. Global Journal of Management and Business Research: C Finance, 19(1), 13-27.
Petersson, J., and Wadman, I. (2004). Non Performing Loans - The markets of Italy and Sweden. Department of Business Studies – Uppsala University.
Pham, H.C. (2020). The impact of Covid-19 pandemic on Vietnamese economy. Journal of Economics and Development, 274, 2-13.
Pham, T.H., Tran, D.H., and Ngo, D.A. (2020). The impact of Covid-19 pandemic on Vietnam’s tourism sector and policy response. Journal of Economics and Development, 274, 43-53.
Pranowo, T., Haris, A., Budianto, E., and Mardiyani, M. (2020). Effect of CAR, LDR, NPL, and NIM on ROA in Devisa public and private banks registered on the IDX 2013-2017 Period. 1st International Conference on Accounting, Management and Entrepreneurship, 165-168.
Ramelli, S., and Alexander, W. (2020). What the stock market tells us about the consequences of COVID-19. In mitigating the COVID economic crisis: Act fast and do whatever it takes. Edited by Richard Baldwin and Beatrice Weder di Mauro. London: CERP Press.
Roman, A., and Sargu, A. C. (2013). Analysing the financial soundness of commercial banks in Romania: an approach based on the Camels framework. Procedia Economics and Fianance, 6(1), 703-712.
Rose, P., and Hudgins, S. (2010). Bank management and financial services. McGraw-Hill/Irwin.
Rozzani, N., and Rahman, R. A. (2013). Camels and performance evaluation of banks in Malaysia: Conventional versus Islamic. Journal of Islamic Finance and Business Research, 2(1), 36–45.
Sang, M. N. (2022). Impact of the Covid-19 pandemic on bank efficiency in Vietnam. Banks and Bank Systems, 17(1), 13-23.
Schoenfeld, J. (2020). The Invisible Risk: Pandemics and financial markets. Tuck School of Business Working Paper, 3567249.
Silaban, P. (2017). The effect of capital adequacy ratio, net interest margin and non-performing loans on bank profitability: The Case of Indonesia. International Journal of Economics and Business Administration, 5(3), 58-69.
Singh, B., Dhall, R., Narang, S., and Rawat, S. (2020). The Outbreak of COVID-19 and
stock market responses: An event study and panel data analysis for G-20 countries. Global Business Review, 0972150920957274.
Stiller, M., and Zink, T. (2020). Impact of COVID-19 on the European banking industry. IDC Perspective. International Data Corporation.
Stulz, R. M., and Carey, M. (2006). The risks of financial institutions. Chicago, University of Chicago Press.
Tan, Y., and Floros, C. (2012). Bank profitability and inflation: The case of China. Journal of Economic Studies, 39(6), 675-696.
Tesfaye, B. L. (2020). The impact of Covid-19 on the Ethiopian private banking system. PhD thesis. University of South Africa.
Timsina, N. (2014). Impact of bank credit on economic growth in Nepal. 2014. NBER Working.
Tobias, O., Temba, M. S. (2011). Effects of banking sectoral factors on the proftability of commercial banks in Kenya. Economics and Finance Review, 1(5), 1-30.
Tran, D. T. (2022). Non-interest income and performance of Vietnamese commercial banks during the Covid-19 pandemic. Journal of Finance, 1(5), 128-131. (in Vietnamese).
Wooldridge, J. M. (2013). Introductory econometrics: A mordern approach. Canada: Cengage Learning.
Yudha, A., Chabachib, M., Rini, I., and Pangestuti, D. (2018). Analysis of the effect of NPL, NIM, non-interest income, and LDR toward ROA with size as control variables: Study on domestic and foreign banks listed on BEI period 2010-2015. Journal Business Strategy, 26(2), 100-113.
Yusuf, M., and Ichsan, R. N. (2021). Analysis of banking performance in the aftermath of the merger of bank Syariah Indonesia in Covid-19. International Journal of Science, Technology and Management, 2(2), 472-478.
Wamucii, J. C. (2010). The relationship between inflation and financial performance of commercial banks in Kenya. Master thesis. University of Nairobi.