The influence of inflation on commercial bank performance: a systematic review

Abstract

This systematic literature review investigates the relationship between inflation and bank performance, providing a theoretical foundation for future scholarly inquiry. A total of thirty-seven peer-reviewed studies published between January 2022 and June 2026 were examined using the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) protocol and descriptive content analysis. Articles were retrieved from Scopus, Web of Science, Emerald, Springer, and Google Scholar under rigorous inclusion and exclusion criteria. The findings demonstrate that the impact of inflation on bank performance is multifaceted and heterogeneous. Profitability emerges as the predominant lens through which performance is assessed, with return on assets (ROA) serving as the most widely employed indicator. Methodologically, the reviewed studies reveal a strong reliance on panel regression techniques (56.75%), with ordinary least squares (OLS), fixed effects, and random effects models forming the core analytical tools for examining bank-specific and macroeconomic drivers. Geographically, the literature spans Asia, Europe, the Middle East, North Africa, and Sub-Saharan Africa (including West Africa), highlighting both the global relevance of inflationary dynamics and the contextual variations in their effects. This review not only synthesizes current finding but also identifies emerging trends and outlines future research directions, offering valuable insights for both academic researchers and practitioners seeking to deepen understanding of inflation’s role in shaping bank performance.