Abstract : Purpose- The aim of this study is to explore the impact of a bank's capital structure on its financial performance. Crafting a specific and comprehensive capital structure for a bank, one that optimizes performance, profitability, size-independent shareholder value, and various other factors, proves to be a challenging endeavor. It is incumbent upon a bank to strategically determine its capital structure, aiming to enhance overall performance, minimize agency costs, and ultimately yield benefits for shareholders as the financing cycle concludes. Profitability is the most important element for companies if they plan to prevail in the long run. Although profit is the main objective of all business activities, little attention is paid to the factors that influence performance in developing countries. The elements that affect the performance of the Bahrain Bourse’s listed financial institutions are hence investigated and evaluated in this research. Methodology- This investigation is founded on an empirical evaluation that explores the correlation between efficiency, a single control variable, and three distinct independent components. In this study, the chosen metrics for assessing bank profitability include return on assets, return on equity, and return on capital employed. The size of assets is selected as the control variable. The capital structure is measured by using three independent variables: total debt-total asset ratio (TDTA), total debt-total equity ratio (TDTE, also referred to as the leverage ratio), and total equity-total asset ratio (TETA). The data used for the analysis were extracted from annual reports from 2011 to 2020 for nine banks listed on the Bahrain Bourse. Panel Least Square analysis and Stationary Effect techniques have been employed in this study. Findings- The data reveals that the TDTA ratio shows a favorable effect on all the firm performance (ROA, ROE, ROCE). This ratio is strongly related to the firm’s performance. TDTE has a negative impact on the firm’s performance (ROA, ROE, ROCE). The findings also show a positive association between TETA, SIZE, and performance (ROA and ROCE) but provide a negative association with ROE. Originality & Value- A crucial management choice is the capital structure decision as this choice immediately affects an enterprise's profitability as well as the return and risk to shareholders. Therefore, this study shows how banks can increase their efficiency and value while minimizing capital costs by the careful choice of capital structure. Bank managers, Policy makers, Academics, and Researchers who plan to utilize the study’s conclusion as a starting point for further investigations into the Bahrain Stock Exchange capital structure may find it useful.