Department of Retail Banking, Commercial Bank of Ethiopia, Jimma District, Ethiopia
Research Article
The Effect of Liquidity Risk Management on Financial Performance of Ethiopian Commercial Banks (2010-2021)
Author(s): Tolera Tsegaye Benti and Ketema Sime Biru*
Banks are major financial institutions that play a pivotal role in the economic system, diverting financial resources from surplus economic agents to deficit ones. The purpose of this study was to examine the impact of liquidity risk on the financial performance of Ethiopian commercial banks. Liquidity risk management and profitability are key issues in a competitive business environment. Fixed-effect balanced panel regressions were used for data from 13 commercial banks for the sample period of interest from 2010 to 2021. We have selected and analyzed six factors that affect the financial performance of commercial banks in Ethiopia. The results of panel data regression analysis showed that liquidity (LATA), leverage (TLA), and Gross Domestic Product (GDP) had statistically significant effects on financial performance of commercial banks. The Funding Gap Index (FGR), Cash Reserve Rati.. Read More»
DOI:
10.37421/2151-6219.2023.14.463
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