Bank Liquidity and Financial Performance: Evidence from Moroccan Banking Industry

Ferrouhi, El Mehdi

doi:10.3846/btp.2014.443

Cited by 30 publications

(27 citation statements)

References 17 publications

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“…As a result of the analysis, the increase in the asset base of banks during the research period (2006)(2007)(2008)(2009)(2010)(2011)(2012)(2013)(2014)(2015) was found to have a positive impact on overall profitability (ROA) of banks working in Pakistan. The finding the analysis is similar to the study of (Goddard, Molyneux, & Wilson, 2004;Steinherr & Huveneers, 1994) who found the mix effect of bank size on profitability (Arif, Khan, & Iqbal, 2013;Ferrouhi, 2014;Tabari, et al, 2013;Velnampy, 2010).…”

Section: Bank Size (Bs)supporting

confidence: 85%

Liquidity Risk and its Impact on Financial Performance of Financial Institutions in Pakistan

Ahmad¹,

Jan²

2017

SJMS

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The 2007-08 financial crisis highlights the significance of sound liquidity management. Liquidity risk is one of the key issues for financial institutions. An organization with a strong asset base, adequate capital and earning may fail if not sustained with good liquidity positions. This study attempts to empirically examine the impact of liquidity risk on the performance of selected banks operating in Pakistan. The panel data over a period of 2006-2015 was collected from the yearly published financial statements of banks working in Pakistan. The data was examined through regression model. Bank size, nonperforming loan ratio and capital adequacy ratio were used as surrogate variable for liquidity risk. The profitability of the selected banks was measured by taking the ratio of return on assets. The results of the regression model show a major impact of liquidity risk on the performance of Banking Institutions. The influence of the capital adequacy ratio and bank size was found significant and positive, while the influence of the nonperforming loan ratio proved insignificant. This study helps to understand the important parameters of liquidity risk and their influence on bank profitability. This study is valuable for risk managers to alleviate liquidity risk by having satisfactory liquid assets. This minimizes the liquidity gap and dependency of the financial institutions on the repo market.

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Section: Bank Size (Bs)supporting

confidence: 85%

Liquidity Risk and its Impact on Financial Performance of Financial Institutions in Pakistan

Ahmad¹,

Jan²

2017

SJMS

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“…As for the Moroccan context, Ferrouhi (2014) studied the relationship between bank liquidity and profitability. To this end, he used a sample of Moroccan banks observed during the period 2001-2012.…”

Section: Literature Reviewmentioning

confidence: 99%

Does Liquidity Matter on Bank Profitability Evidence from a Nonlinear Framework for a Large Sample

Hamdi¹,

Hakimi²

2020

berj

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The aim of this paper is to define the optimal level of liquidity and to investigate its impact on the overall bank profitability. To achieve these goals, we use a large sample of 127 countries over the period [2005][2006][2007][2008][2009][2010][2011][2012][2013][2014][2015]. The whole sample is divided in two sub-samples. The first covers 46 high income countries and the second includes 81 low and middle income countries. We performed the Panel Smooth Transition Regression (PSTR) as econometric approach. Empirical results show that the optimal level of liquidity that affects bank profitability is 24.18% for high income countries and 40.45% for low and middle income countries. Findings also indicate that credit risk decreases significantly the level of profitability of the two groups of countries.

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“…(ROAA) and (ROAE) have been used by several researchers including Kosmidou, Tanna, and Pasiouras (2005), Said et al 2011, Grassa (2012), Wasiuzzaman and Gunasegavan (2013), Ferrouhi (2014) and Garcia and Guerreiro (2016). Kosmidou et al (2005) reported a positive association between ROAA and liquidity risk.…”

Section: Profitability and Liquidity Riskmentioning

confidence: 99%

The Moderating Role of Staff Efficiency in the Relationship between Bank’s Specific Variables and Liquidity Risk in Islamic Banks of Gulf Cooperation Council (GCC) Countries

Shamas¹,

Zainol²,

Zainol³

2017

IJEF

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The efficiency of bank’s staff plays a crucial role in managing and mitigating the financial risks like liquidity risk. The aim of this paper is to propose a conceptual model/framework for investigating the moderating role of staff efficiency on the relationship between bank’s specific variables and liquidity risk in Islamic banks in Gulf Cooperation Council (GCC). GCC economies depend heavily on oil revenues which makes it subject to oil prices fluctuations. Therefore, liquidity in GCC banks, especially Islamic banks almost always suffers liquidity pressure. Thus, the issue of liquidity in this region has grown in importance in light of recent oil decline. Several attempts have been made to investigate the determinants of liquidity risk, yet the findings lack consistency. Most of the previous studies have ignored GCC region and have focused on other environments like credit risk but gave less attention to the moderating role of staff efficiency function in the Islamic banks with respect to liquidity risk. This paper offers a framework by adding a moderator of staff efficiency to the existing models of the bank’s specific determinants of liquidity risk with a particular attention to the GCC countries which are heavily dependent on oil revenues and always are subject to the impact of oil prices instabilities. Many stakeholders should benefit from the outcomes of this study. It should pave the way for bankers, regulators, investors and researchers to have a better understanding and insight about the factors that affect liquidity risk in the aforesaid banks.

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Bank Liquidity and Financial Performance: Evidence from Moroccan Banking Industry

Cited by 30 publications

References 17 publications

Liquidity Risk and its Impact on Financial Performance of Financial Institutions in Pakistan

Liquidity Risk and its Impact on Financial Performance of Financial Institutions in Pakistan

Does Liquidity Matter on Bank Profitability Evidence from a Nonlinear Framework for a Large Sample

The Moderating Role of Staff Efficiency in the Relationship between Bank’s Specific Variables and Liquidity Risk in Islamic Banks of Gulf Cooperation Council (GCC) Countries

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