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This study attempts to determine the factors affecting the dividend payout decision of commercial banks in Nepal. The study is based on the secondary balance panel data of 12 commercial banks with 60 observations' for the period of 2013/14 to 2017/18. The dividend payout ratio has taken as dependent variables whereas return on assets, size of bank, market value per share, and inflation rate has been taken independent variables. The results of Pooled OLS model and Random Effects model for panel data analysis has been estimated in this study. The regression result of these models reveals that profitability, size of banks and Inflation rate are negatively related to dividend payout decision of Nepalese commercial banks evidences. It shown that higher the profitability, size of banks and Inflation rate lower would be the dividend payout decisions. However the results show that market value per share has positive relationship with dividend payout decision. This indicates that increase in the level of market value per share leads to increase in the dividend payout decision. The study has concluded that the market value per share is the major determinant of dividend payout decision.
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