The effect of institutional quality on financial transparency and bank interest margins of banks listed on the Tehran Stock Exchange

The banking system transparency increases the level of competitiveness among banks and will increase power of the market in magnetizing the dispersed capitals in the long run. Dispersed capitals will be absorbed into the country's banking system when the quality of disclosure and transparency of the banking system is up to predetermined desirable standards. The research method is correlational in terms of nature and content, but in terms of applied purpose it is considered to be descriptive-correlation method. The statistical population of this research is all OTC (over the counter) banks and the Tehran Stock Exchange over the years 2014 to 2021. Out of the banks in the statistical population, 16 banks have been selected as sample banks. According to the results of the research, the first hypothesis of the research is confirmed, that is, there is a negative (inverse) and significant relationship between financial transparency and bank interest margin. The second hypothesis of the research is rejected, that is, the relationship between financial sectors’ transparency and bank interest margin are not affected by institutional quality.