Determinants of the Liquidity in Romanian Interbank Deposits Market

Lovin, Horaţiu

doi:10.1016/s2212-5671(13)00060-9

Cited by 1 publication

(1 citation statement)

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“…The above items were compared through analysis of the relative contribution to the total ratio and correlation analysis. Lovin (2013) investigated the effect of a liquidity shock induced by depositors' behavior on bank portfolio management during financial crises in a system without deposit insurance. The study detected that banks reacted to the liquidity shock sensitively through an increase in their cash holdings not by liquidating bank loans but by selling securities in the financial market.…”

Section: Introductionmentioning

confidence: 99%

A study on effect of bank resources and consumption on liquidity

Panahian¹,

Ghodrati²,

Parvishi³

2014

10.5267/j.msl

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Liquidity management in banks is a conflict between risk and return. On the one hand, the lack of liquidity, in addition to imposing heavy costs of providing resources (including borrowings from the central bank at elevated rates), may also lead banks to face with bankruptcy. On the other hand, the maintenance of excessive liquidity than needed will destroy investment opportunities and potential profitability. Therefore, for proper liquidity management, it is necessary to understand the factors affecting this sector to be able to exert control on each of the elements, and to prevent the incidence of problems or even crisis thereby optimize the bank profitability as far as possible. This study aimed to analyze the resources, expenses, and liquidity operating as the main activity parameters in Bank Shahr. During the study timeframe (2010 until the end of 2012), every 15 days was selected as the sample community, which were selected due to a 15-day trend analysis using census method and not by random sampling. The related data concerning each of the items, i.e. resources, expenses, and liquidity were collected and analyzed by linear regression based on time or periods of time. The above items were compared through analysis of the relative contribution to the total ratio and correlation analysis. The results showed that the growing trends of resources and expenses almost coincide and followed a specific trend and, in general, the growing trend of the resources was rising with a higher slope compared with those of expenses and liquidity. In addition, the growing trend of liquidity was almost identical throughout the entire period of study and no unusual trend was observed.

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Section: Introductionmentioning

confidence: 99%