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http://dx.doi.org/10.13106/jafeb.2020.vol7.no12.085

Macroeconomic and Bank-Specific Variables and the Liquidity of Jordanian Commercial Banks  

AL-QUDAH, Ali Mustafa (Department of Finance and Business Economics, Faculty of Economics and Administrative Sciences, Al Al-Bayt University)
Publication Information
The Journal of Asian Finance, Economics and Business / v.7, no.12, 2020 , pp. 85-93 More about this Journal
Abstract
This study aimed to explore the impact of macroeconomic (Real GDP growth (GDPG), Inflation rate (INF)) and bank -specific variables (profitability (ROA), capital adequacy (CADEQ), non-performing loans (NPL), deposit growth (DEPG)) on the liquidity (lIQ) of 13 listed Jordanian commercial banks for the period 2011-2018. Panel data analysis, Pooled least square, fixed effects model and random effects model, Lagrange multiplier test, and Hausman test were used. The random effects model output shows that, macroeconomic variables have a significant impact on Jordanian commercial banks liquidity since inflation has a positive impact while GDPG has a negative impact on banks (LIQ). On the other hand among the bank-specific variables capital adequacy and deposit growth have a positive significant impact on banks (LIQ), while (NPL) and (SIZE) have a negative significant impact on Jordanian commercial banks liquidity. But ROA has a negative insignificant impact on (LIQ). The findings of the study suggest that commercial banks departments need to pay attention to the economic and internal variables of banks in order to maintain acceptable levels of liquidity.
Keywords
Banks; Macroeconomic; Bank-Specific; Panel Data; Liquidity;
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Times Cited By KSCI : 6  (Citation Analysis)
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