Khala , Basha Abu; Awad, An oine B.
A icle
Explo ing he bea ing o liquidi y isk in he Middle Eas
and No h A ica (MENA) banks
Cogen Economics & Finance
P o ided in Coope a ion wi h:
Taylo & F ancis G oup
Sugges ed Ci a ion: Khala , Basha Abu; Awad, An oine B. (2024) : Explo ing he bea ing o liquidi y
isk in he Middle Eas and No h A ica (MENA) banks, Cogen Economics & Finance, ISSN
2332-2039, Taylo & F ancis, Abingdon, Vol. 12, Iss. 1, pp. 1-16,
h ps://doi.o g/10.1080/23322039.2024.2330840
This Ve sion is a ailable a :
h ps://hdl.handle.ne /10419/321462
S anda d-Nu zungsbedingungen:
Die Dokumen e au EconS o dü en zu eigenen wissenscha lichen
Zwecken und zum P i a geb auch gespeiche und kopie we den.
Sie dü en die Dokumen e nich ü ö en liche ode komme zielle
Zwecke e iel äl igen, ö en lich auss ellen, ö en lich zugänglich
machen, e eiben ode ande wei ig nu zen.
So e n die Ve asse die Dokumen e un e Open-Con en -Lizenzen
(insbesonde e CC-Lizenzen) zu Ve ügung ges ell haben soll en,
gel en abweichend on diesen Nu zungsbedingungen die in de do
genann en Lizenz gewäh en Nu zungs ech e.
Te ms o use:
Documen s in EconS o may be sa ed and copied o you pe sonal
and schola ly pu poses.
You a e no o copy documen s o public o comme cial pu poses, o
exhibi he documen s publicly, o make hem publicly a ailable on he
in e ne , o o dis ibu e o o he wise use he documen s in public.
I he documen s ha e been made a ailable unde an Open Con en
Licence (especially C ea i e Commons Licences), you may exe cise
u he usage igh s as speci ied in he indica ed licence.
h ps://c ea i ecommons.o g/licenses/by/4.0/
Cogen Economics & Finance
ISSN: 2332-2039 (Online) Jou nal homepage: www. and online.com/jou nals/oae 20
Explo ing he bea ing o liquidi y isk in he
Middle Eas and No h A ica (MENA) banks
Basha Abu Khala & An oine B. Awad
To ci e his a icle: Basha Abu Khala & An oine B. Awad (2024) Explo ing he bea ing o
liquidi y isk in he Middle Eas and No h A ica (MENA) banks, Cogen Economics & Finance,
12:1, 2330840, DOI: 10.1080/23322039.2024.2330840
To link o his a icle: h ps://doi.o g/10.1080/23322039.2024.2330840
© 2024 The Au ho (s). Published by In o ma
UK Limi ed, ading as Taylo & F ancis
G oup
Published online: 24 Ma 2024.
Submi you a icle o his jou nal
A icle iews: 2105
View ela ed a icles
View C ossma k da a
Ci ing a icles: 12 View ci ing a icles
Full Te ms & Condi ions o access and use can be ound a
h ps://www. and online.com/ac ion/jou nalIn o ma ion?jou nalCode=oae 20
FINANCIAL ECONOMICS | RESEARCH ARTICLE
Explo ing he bea ing o liquidi y isk in he Middle Eas and No h
A ica (MENA) banks
Basha Abu Khala and An oine B. Awad
College o Business, Accoun ing & Finance Depa men , Uni e si y o Doha o Science and Technology, Doha, Qa a
ABSTRACT
The pape examines how liquidi y isk a ec s he Middle Eas and No h A ica
(MENA) bank p o i abili y. Banks need p o i abili y o su i e, bu liquidi y isk meas-
u es long- e m company heal h. Th ough Re ini i Eikon, quan i a i e da a was col-
lec ed o e 11 yea s om 2012 o 2022 o 71 MENA banks o suppo he heo e ical
s udy. Re u n on Equi y (ROE), a p o i abili y indica o , is he dependen a iable,
whe eas liquidi y isk is he independen a iable and con olling o size, loan quali y,
in la ion, g oss domes ic p oduc , income di e si ica ion, ope a ional e iciency, capi al
adequacy, and g ow h. This s udy es ima es he impac o liquidi y isk on MENA bank
p o i abili y using OLS and panel eg ession ( ixed and andom e ec s). Se e al esul s
we e ound, such as ha bank size, ope a ional e iciency, and non-pe o ming loans
nega i ely a ec p o i abili y, sugges ing ha la ge banks ha e highe ope a ing cos s
and may weaken p o i abili y in MENA. Besides, addi ional non-pe o ming loans
inc ease he bank’s cos s and hus diminish p o i abili y. Also, i he bank has no con-
ol o e he ope a ional expenses, hen his will lead o educe p o i abili y. Liquidi y
isk, capi al adequacy, income di e si ica ion, and g ow h ha e a posi i e signi ican
impac on ROE implying ha banks wi h highe g ow h oppo uni ies, be e capi al
adequacy a io, mo e income sou ces, and liquidi y isk will esul in highe p o i abil-
i y as explained by he isk- ewa d heo y. The esul s a e obus and his has been
con i med by applying he Gene alized Me hod o Momen s (GMM).
IMPACT STATEMENT
This s udy aims o in es iga e he in luence o liquidi y isk on he p o i abili y o
banks in he Middle Eas and No h A ica (MENA) egion o e he pe iod o 2012 o
2022 o a o al o 71 banks. The analysis employs O dina y Leas Squa es (OLS) and
panel eg ession echniques, including ixed and andom e ec s models. The esul s
a e obus and his has been e i ied by implemen ing he Gene alized Me hod o
Momen s (GMM). Mul iple indings indica e ha ac o s such as bank size, ope a ional
e iciency, and non-pe o ming loans ha e a nega i e impac on p o i abili y. Besides,
Liquidi y isk, income di e si ica ion, g ow h, capi al adequacy and g oss domes ic
p oduc ha e posi i e impac on p o i abili y. This s udy p o ides aluable insigh s
in o he complex ela ionship be ween liquidi y isk and p o i abili y in he banking
sec o o he Middle Eas and No h A ica (MENA) egion. The s udy's conclusions no
only con ibu e o academic knowledge bu also ha e p ac ical consequences o
banking p o essionals, egula o s, and in es o s, highligh ing i s b oad in luence ac oss
a ious sec o s.
ARTICLE HISTORY
Recei ed 25 June 2023
Re ised 8 Ma ch 2024
Accep ed 12 Ma ch 2024
KEYWORDS
Liquidi y isk; banks; e u n
on equi y; MENA egion;
panel eg ession
REVIEWING EDITOR
Da id McMillan, Uni e si y
o S i ling, Uni ed Kingdom
SUBJECTS
Economics; Finance;
Business, Managemen and
Accoun ing
JEL
G15; G20; G33
1. In oduc ion
In coun ies o he Middle Eas and No h A ica (MENA), banks a e he main p o ide s o inancial se -
ices, as he economies ha e bank-based inancial sys ems (Uzunkaya, 2012). The e o e, ha ing ib an
banks is c ucial o he MENA egion as ill-pe o ming banks o a ailing banking sec o impac he econ-
omy ad e sely. Fu he mo e, sound banks a e conside ed o suppo he economy in un a o able
CONTACT D . Basha Abu Khala [email p o ec ed] College o Business, Accoun ing & Finance Depa men , Uni e si y o
Doha o Science and Technology, Doha, Qa a
ß2024 The Au ho (s). Published by In o ma UK Limi ed, ading as Taylo & F ancis G oup
This is an Open Access a icle dis ibu ed unde he e ms o he C ea i e Commons A ibu ion License (h p://c ea i ecommons.o g/licenses/by/4.0/), which
pe mi s un es ic ed use, dis ibu ion, and ep oduc ion in any medium, p o ided he o iginal wo k is p ope ly ci ed. The e ms on which his a icle has been
published allow he pos ing o he Accep ed Manusc ip in a eposi o y by he au ho (s) o wi h hei consen .
COGENT ECONOMICS & FINANCE
2024, VOL. 12, NO. 1, 2330840
h ps://doi.o g/10.1080/23322039.2024.2330840
condi ions and c ises (Rdaydeh e al., 2017). Technological inno a ion, globaliza ion, and a compe i i e
ma ke en i onmen challenge he p o i abili y o banks globally and in he MENA egion. Howe e , li le
is known abou he ac o s ha con ibu e o ib an and p o i able banks in his egion. Ou pape ills
his esea ch gap by s udying bank and coun y-speci ic impac ac o s on banks’p o i abili y using a
sample o 71 MENA banks o he yea s 2012 o 2022.
Liquidi y isk can be de ined as an a ising isk when a bank is unable o mee i s obliga ions a he
ime o due in he absence o incu ing undesi able losses (Ismail & Ahmed, 2023). The e o e, his isk
can ha e an ad e se impac on he inancial ins i u ions’capi al and ea nings. The bank’s managemen
should ensu e ha he e a e su icien unds a ailable o ul ill u u e eques s om lende s and bo -
owe s a easonable a es. Simila ly, Hacini e al. (2021) de ined liquidi y isk as he possibili y o an
ins i u ion o lose money i i is unable o pay i s bills on ime o und asse g ow h when i becomes
necessa y wi hou incu ing unaccep ably high cos s o losses. Ano he de ini ion o liquidi y isk is he
dange o being unable o quickly and a o dably liquida e a posi ion.
The in luence o he liquidi y si ua ion on he managemen o banks and o he economic uni s has
always been a ac i e and compelling. In he li e a u e o e he yea s, he e seems o ha e been an
endless deba e on he unc ions, signi icance, and ac o s ha a ec liquidi y isk. The goal o liquidi y
managemen is o ensu e ha an asse may be apidly and eliably con e ed back in o unds (cash o
income) any ime he asse holde desi es (Khala & Alajlani, 2021; Saleh e al., 2020). A liquid inancial
ins i u ion is when i has enough cash and liquid asse s on hand, in addi ion o he capabili y o quickly
aise unds h ough addi ional sou ces aiming o sa is y i s inancial commi men s and espec deadlines
o paymen s (Ouma, 2015). Fu he mo e, his empi ical pape in es iga es he impac o liquidi y isk on
banks’p o i abili y in he MENA egion.
This empi ical pape is s uc u ed in i e sec ions. Sec ion 2 p o ides a summa y o selec ed p e ious
s udies and Sec ion 3 explains he me hodology and he model de elopmen . Sec ion 4 highligh s he
esul s and discussion. Sec ion 5 shows he conclusion o his pape .
2. Li e a u e e iew
Bou ke (1989) examined he d i e s o e u n on asse s and ound ha ins i u ions wi h supe io liquidi y
gene a e be e ea nings. Banks ypically ha e excessi e p o i abili y i hey ha e excessi e liquidi y,
acco ding o Kosmidou’s(2008) obse a ion. Mo eo e , Rahman e al. (2015) also esea ched liquidi y
isk and p o i s by analyzing he esul s o a selec ed sample o 25 Bangladeshi inancial ins i u ions
be ween he yea s o 2003 and 2006. The indings indica e a link be ween bo h liquidi y isk and bank
p o i abili y, indica ing ha ins i u ions equi e g ea e liquidi y o un mo e e ec i ely. Liquidi y, acco d-
ing o Islam & Nishiyama (2016), con ibu es o he p o i abili y o banks bu does no signi ican ly do
so. Chen e al. (2018) used panel da a om 12 de eloped economies om 1994 ill 2006 o iden i y ac-
o s d i ing Liquidi y isk as well as i s ela ionship o inancial ins i u ions p o i abili y. The indings
demons a ed a basic and ad e se ela ionship be ween liquidi y isk and p o i abili y as p ojec ed
h ough he unding gap. As p edic ed by ROA and ROE, a be e inancing gap (g ea e liquidi y) lowe s
inancial ins i u ion e enue. These ac s lead o a conclusion s a ing ha he p o i abili y o inancial
ins i u ions is signi ican ly impac ed by liquidi y isk.
The impac o liquidi y isk on he p o i abili y o inancial ins i u ions, as de e mined by he e u n
on equi y in he Eu ozone egion, was discussed by Tou ou and Xiaodong in 2011. Reg ession analysis
was used o analyze seconda y da a ha was ga he ed om inancial epo s o 12 banks in he
Eu ozone egion be ween he yea s 2005 and 2010. The indings showed ha liquidi y isk has a a o -
able e ec on ROE in he Eu ozone egion. Simila indings we e made by Ruziqa (2013), who used sec-
onda y da a ga he ed om 23 adi ional banks be ween 2007 and 2011 o examine such a ela ionship
in Indonesia and ound ha he e was a posi i e signi ican ela ionship.
Liquidi y was highligh ed as one o he elemen s a ec ing p o i abili y by Be
ıos (2013) in esea ch
aiming o iden i y he de e minan s o p o i abili y in comme cial inancial ins i u ions in Kenya. The
esea ch in ol ed 35 inancial ins i u ions wi h he da a o 5 yea s. The s udy es ima ed he ac o s in lu-
encing comme cial banks’p o i abili y using desc ip i e s a is ics and mul iple eg ession analysis. The
s udy concluded ha liquid asse s conside ably in luence he p o i abili y o comme cial banks,
2 B. ABU KHALAF AND A. B. AWAD
pa icula ly du ing he ime o poli ical chaos ollowing elec ions. The esul s also showed ha bo h he
inside holdings in addi ion o he enu e o he CEO impac nega i ely he bank’s pe o mance.
Rahman e al. (2015) examined he ela ionship be ween liquidi y isk and Bangladeshi inancial ins i-
u ions’p o i abili y as de e mined by e u n on equi y. The ou come was de e mined h ough he ana-
lysis o seconda y da a ga he ed om 6 banks ou o which 3 banks we e Islamic ins i u ions and 3
o he con en ional comme cial banks be ween 2007 and 2011. The esul s o he s udy e ealed ha
he bank’s egula o y capi al, size, liquidi y, and loan in ensi y a e posi i ely in luencing i s p o i abili y.
Besides, o he a iables such as he bank’s cos e iciency and o -balance shee ac i i ies in addi ion o
he in la ion a e a e nega i ely in luencing i s p o i abili y. Simila ly, Saeed disco e ed his by analyzing
27 comme cial Malaysian inancial ins i u ions using seconda y da a om he yea s 2005 o 2013 and
he inal esul s con i med he posi i e impac o he bank’s liquidi y on i s p o i abili y.
Ouma (2015) in es iga ed he e ec o liquidi y isk on p o i abili y. I was ound ou ha i liquidi y
issues a e le unchecked, hey can nega i ely a ec a inancial o ganiza ion’s capi al, p o i abili y, and,
in ex eme cases, e en cause he ins i u ion o ail. In addi ion, a inancial ins i u ion ha ing liquidi y
issues migh addi ionally expe ience p oblems in sa is ying he demands o cus ome s, al hough his
liquidi y isk can be a oided by keeping app op ia e cash on hand, inc easing he deposi base, and
imp o ing he comme cial banks’p o i abili y. A inancial ins i u ion’s dependency on he inancial ma -
ke s would be less jus wi h enough cash holdings; hus, minimizing he cos o o e nigh bo owing.
Such issues mus be di ec ly se monized and ins an aneous measu es need o be conside ed o e ade
he ou comes o illiquidi y.
To ha e a be e unde s anding o liquidi y isk and ROA, Salim & Bilal (2016) also in es iga ed his
connec ion in he Middle Eas e n coun y Oman. The da a was ga he ed om he annual epo s o 4
Omani inancial ins i u ions o he pe iod 2010-2014. Using he mul iple eg ession analysis, he au ho s
p o ed ha he loan- o- o al asse s a io and he liquid asse s- o- o al deposi s a e signi ican ly in luenc-
ing he bank’s ROA. Besides, his s udy ailed o iden i y a signi ican ela ionship be ween he bank’s
liquidi y posi ion and i s ne in e es ma gin.
Malik e al. (2016) addi ionally disco e ed a me e ela ionship be ween liquidi y and p o i abili y in
he p i a e sec o banks o Pakis an. The da ase was collec ed om 22 p i a e Pakis ani banks o he
pe iod 2009-2013. The s udy u ilized he o dina y leas squa e eg ession o p o e s a is ically ha he
liquidi y posi ion o he Pakis ani banks in luences he bank’s e u n on asse s. Consequen ly, he same
s udy ailed o iden i y a signi ican ela ion be ween he bank’s liquidi y and i s e u n on equi y. Las ly,
he au ho s ad ised he banks o o mula e hei u u e s a egies in a way o p ope ly manage hei
liquidi y posi ion.
Addi ionally, Chowdhu y e al. (2018) sough o cla i y he ela ionship be ween liquidi y isk and ROE
in ligh o he ac ha Bangladesh’s banking sec o was expe iencing a liquidi y c isis. Six Islamic banks’
in o ma ion was ga he ed om 2012 o 2016. The indings e ealed a non-signi ican link be ween
liquidi y measu es and ROE. Be ios (2013), howe e , did no disco e a simila ela ionship when exam-
ining in o ma ion ga he ed om 5 Islamic banks be ween 2001 and 2011 in Bangladesh. This could be
due o he ac ha esea ch pe iods in he wo cases we e di e en in e ms o he numbe o yea s.
The pe iod 2010-2014 also demons a ed he essen ial posi i e in luence o liquidi y isk on he e u n
on equi y, in Oman by using seconda y in o ma ion accumula ed om ou comme cial banks by Salim
& Bilal (2016).
Addou & Bensghi (2021) a icle in es iga ed he p ima y ac o s in luencing he liquidi y isk aced in
he Uni ed A ab Emi a es (UAE) by Islamic inancial ins i u ions. The esea ch ocused on 4 Islamic en i-
ies in he UAE using annual da a ex ac ed om hei annual epo s. The esea che s used six a iables
such as size, e u n on equi y, non-pe o ming loans, e u n on asse s, and capi al adequacy a io o
da a analysis using linea eg ession analysis. The esul s o he model demons a e ha bo h he e u n
on asse s and non-pe o ming loans ha e a nega i e e ec on he Emi a i banks’liquidi y isk.
Abbas e al. (2021) examined how unding liquidi y isk a ec s banks’p opensi y o ake isks is he
d i ing o ce behind his esea ch. They used da a om US comme cial banks be ween 2002 and 2018
and he wo-s age sys em GMM me hod o examine he hypo heses. Thei esea ch shows ha US com-
me cial banks a e mo e willing o ake isks when hey ha e access o liquid inance. In addi ion, he e is
COGENT ECONOMICS & FINANCE 3
less o e sigh o bank manage s’ isky beha io and ewe unding sho ages o banks wi h bigge
deposi s.
Widya i e al. (2022) conduc ed esea ch on he impac o non-pe o ming loans, e u n on asse s,
e u n on equi y, and bank size on he liquidi y isk o Indonesian banks. The s udy encompassed 40
s a e-owned and p i a e banks wi h a da ase ex ac ed o he pe iod 2016-2020. The au ho s u ilized
he OLS eg ession o p o e ha he bank’s e u n on asse s and e u n on equi y a e posi i ely in luenc-
ing he bank’s liquidi y isk in Indonesia. Subsequen ly, he esul s also e ealed ha he non-pe o ming
loans along wi h he bank size do no impac he liquidi y isk.
As udybySai -Alyous i(2022) in ol ing 2,446 banks aimed o iden i y he de e minan s o bank p o i abil-
i y in 47 Asian coun ies. The au ho compiled 41,582 obse a ions o c ea e a da ase o he pe iod 1995-
2017. Using he Gene alized Me hods o Momen s (GMM) es ima ion echnique, he esul s o he esea ch
p o ed ha he liquidi y isk, capi al adequacy a io, loan- o- o al asse s, bank size, GDP g ow h, and in la ion
a e a e posi i ely associa ed wi h he bank’s e u n on asse s. Besides, o he a iables such as cos - o-income,
non-pe o ming loans, and loan loss p o isions a e nega i ely impac ing bank p o i abili y.
Using a dynamic GMM panel app oach, Shoaib Ali e al. (2022) p opose o examine he e ec o
banking-sec o concen a ion on he liquidi y c ea ion o banks in GCC na ions om 2012 o 2018. The
indings poin o a dec ease in liquidi y c ea ion by banks h oughou he GCC na ions as a esul o
g ea e banking i al y. The esul s o he s udy co obo a e he ‘ inancial agili y hypo hesis’, which
s a es ha when ma ke compe i ion is ie ce, banks will cu back on lending.
Ano he s udy by Ismail & Ahmed (2023) c ea ed a panel da ase o he pe iod 2016-2021 o examine
he impac o liquidi y isk, c edi isk, and ope a ional isk on he inancial s abili y o Jo danian banks.
The schola selec ed all con en ional comme cial banks lis ed in he Amman S ock Exchange and u ilized
he panel eg ession echnique o p o e ha bo h c edi isk and COVID-19 ha e nega i ely a ec ed he
bank’s s abili y. The s udy also showed ha liquidi y isk, ope a ional isk, and bank size do no ha e
any signi ican in luence o e he Jo danian’s bank s abili y.
Rubbaniy e al. (2023) ound empi ical e idence ha he Business Cycle (BC) has a nonlinea e ec on
liquidi y gene a ion using a panel smoo h ansi ion eg ession amewo k using US bank holding com-
pany qua e ly da a om 1993Q1 o 2020Q1, as well as a new p oxy o he business cycle index. They
disco e ha he BC has a posi i e and s a is ically signi ican nonlinea impac on liquidi y gene a ion,
lending c edence o he idea ha liquidi y c ea ion is p o-cyclical and leading o an imp o emen in
liquidi y c ea ion es ima ion when compa ed o ea lie esea ch.
3. Me hodology
3.1. Sample used
In his esea ch pape , he main ma ke ocus will be he MENA egion’s banking sec o wi h da a
ex ac ed om he Re ini i Eikon pla o m o he pe iod 2012-2022. This pape comp ised da a o 11
coun ies, ha is 7 coun ies om he Middle Eas and 4 o he coun ies om No h A ica, as his will
help in be e unde s anding he di e en inancial en i onmen s. As s a ed in Table 1, he popula ion
Table 1. Sample o he s udy.
Coun y Popula ion Final Sample Coun y Popula ion Final Sample
Panel A: Middle Eas Panel C: Full Sample
Bah ain 9 4 Bah ain 9 4
Jo dan 14 8 Egyp 10 6
Kuwai 11 7 Jo dan 14 8
Oman 7 4 Kuwai 11 7
Qa a 9 6 Libya 14 8
Saudi A abia 10 7 Mo occo 6 4
UAE 18 9 Oman 7 4
Panel B: No h A ica Qa a 9 6
Egyp 10 6 Saudi A abia 10 7
Libya 14 8 Tunisia 11 8
Mo occo 6 4 UAE 18 9
Tunisia 11 8 To al 119 71
Sou ce: Au ho s’Analysis.
4 B. ABU KHALAF AND A. B. AWAD
and he inal sample whe e any bank wi h missing da a o mo e han 3 yea s was excluded om ou
sample.
The selec ion o banks is based on he a ailabili y o da a aiming o achie e eliable and accu a e
esul s. In addi ion, be o e excluding he bank, any missing da a we e sea ched o in he annual epo s
o he e lec i e banks o he s ock ma ke exchange ela ed o ha speci ic ma ke .
3.2. Model de elopmen
3.2.1. Dependen a iable: e u n on equi y
Re u n on equi y is a a io calcula ed as ne income di ided by a e age sha eholde s’equi y (No aini,
2012; Seissian e al., 2018). Acco ding o Fa hi & Hacini (2021), he e u n on equi y is conside ed a c u-
cial inancial me ic ha shows i he bank is p ope ly u ilizing i s esou ces. Ano he s udy by Be ani &
Hacini (2021) pinpoin ed he impo ance o he e u n on equi y in showing how much he bank is ea n-
ing om i s o al equi y. Di e en conclusions we e eached a e looking in o he impac o liquidi y
isk on ROE in se e al s udies. Sya i’i & Ruslia i (2016) and Mwangi (2014) disco e ed a signi ican
a i ma i e e ec o liquidi y isk on ROE while o he s such as Hacini e al. (2021) disco e ed a signi ican
nega i e ela ionship. Though, o he s udies simila o Badawi (2017) ha e disco e ed a non-signi ican
ela ionship be ween he bank’s liquidi y isk and i s ROE.
3.2.2. Independen a iables
3.2.2.1. Liquidi y isk. Liquidi y, as de ined by he Basel Commi ee on Banking Supe ision in 2008, is a
bank’s capaci y o inance asse g ow h and pay commi men s when hey become due wi hou
igge ing impe missible losses (Ojo, 2010). Acco ding o he commi ee, a inancial ins i u ion becomes
ulne able o liquidi y isk when i ul ills he undamen al unc ion o ma u ing sho - e m deposi s in o
long- e m loans, bo h on an ins i u ion-speci ic le el and in a way ha impac s he ma ke as a whole. A
bank can ul ill i s i egula cash low obliga ions which a e impac ed by ex e nal e en s and he ac i -
i ies o o he agen s by e ec i ely managing i s liquidi y isk (Badawi, 2017).
Th ough he use o a panel da a se o comme cial banks om indus ialized economies, Chung e al.
s udied he causes o liquidi y isk in hei s udy Bank Liquidi y Risk and Pe o mance. I was disco e ed
ha dependency on ou side inance and liquid asse s a e he main con ibu o s o liquidi y isk. Due o
he inc eased cos o unds, liquidi y isk educes bank p o i abili y bu boos s ne in e es ma gin. The
indings demons a ed ha , in a inancial sys em based on ma ke s, liquidi y isk has a nega i e ela ion-
ship wi h bank ROA and ROE. O he s udies such as Hacini e al. (2021) con i med ha liquidi y isk has
a signi ican nega i e impac on he bank’s p o i abili y. Hence, we hypo hesize:
H
1
: The liquidi y isk has a nega i e impac on he p o i abili y o banks.
3.2.2.2. Size. The Size o he bank is calcula ed using he na u al loga i hm o o al asse s (Awad e al.,
2022; Khala e al., 2023a). This measu e o he bank size is gene ally used as a measu e o economies
o scale in he banking indus y acco ding o Widya i e al. (2022). La ge inancial ins i u ions ypically
ha e he po en ial o aise capi al a a lowe cos and display highe p o i abili y. Bank p o i abili y is
posi i ely co ela ed wi h la ge capi aliza ion. Acco ding o Mes e (2010), he p o i abili y and size o
he bank a e immensely ela ed. Enla ging he bank size will enla ge he p o i abili y o inancial ins i u-
ions by allowing hem o ecognize he economic scale. An illus a ion, enla ging size le s inancial ins i-
u ions inc ease ixed expenses o e a g ea e asse base, he eby dec easing common expenses.
Enla ging inancial ins i u ions’asse size can also b ing down isk by b anching ou ope a ions ac oss
egions and sec o s. Ano he s udy by Aladwan (2015) including Jo danian banks concluded ha bank
size has a signi ican e ec on p o i abili y. The s udy p o ed ha small and medium-sized banks ha e a
be e inancial pe o mance implying a highe p o i abili y in compa ison o la ge banks; hus, conclud-
ing a nega i e ela ion be ween p o i abili y and size. O he s udies by Yuen e al. (2022) and Phan e al.
(2020) ound ha he size ac o has a signi ican posi i e ela ionship wi h p o i abili y. Gi en he mixed
esul s in he li e a u e, we hypo hesize:
COGENT ECONOMICS & FINANCE 5
H
2
: The size has a posi i e impac on he p o i abili y o banks.
3.2.2.3. Loan quali y. Loans o e ed by banks no paid o in due ime go on o become non-pe o m-
ing loans in he banking sec o . This causes un a o able impac s on he banking sec o , speci ically in
e ms o p o i abili y. The impac sp eads on o ela ed banks, cen al go e nmen budge s, and a ious
o he sec o s (Ko en, 2021). Lending money o people is one o he main unc ions o comme cial banks,
and hei main e enue s eams. Al e na i ely, loans a e conside ed among he asse s ha will p o ide a
high yield o he bank. Acco ding o Ab eu and Mendes, i can be unde s ood undeniably ha he mo e
loans comme cial banks p o ide o he public, he mo e mone a y alue is c ea ed in he economy.
Howe e , banks mus be cau ious when expanding hei loan po olios as doing so exposes hem o
de aul and liquidi y isks ha nega i ely impac hei capaci y o gene a e income and su i e. A s udy
by Husni (2011) shows ha he in e es ob ained on bank loans is a signi ican d i e o p o i abili y and
has a posi i e associa ion wi h he p o i abili y o inancial ins i u ions. This was also discussed in
esea ch by Vong and Chan who demons a ed he ela ionship be ween p o i abili y and loan quali y
sugges ing o use he bank’s non-pe o ming loans as a gauge o loan quali y. Ano he s udy by
Alnabulsi e al. (2022), e eals ha bank p o i abili y is in e sely ela ed o non-pe o ming loans in he
MENA egion. This implies ha banks wi h less non-pe o ming loans epo mo e p o i abili y igu es
unlike he esul s acqui ed in No h A ican Coun ies. O he s udies by Yuen e al. (2022), Widya i e al.
(2022), and Badawi (2017) e ealed ha he bank’s non-pe o ming loans le el does no impac s a is ic-
ally i s p o i abili y. S ill, a s udy by Sya i’i & Ruslia i (2016) in Indonesia con i med a signi ican nega i e
associa ion be ween he bank’s non-pe o ming loans and i s e u n on asse s. Thus, we hypo hesize:
H
3
: The loan quali y has a nega i e impac on he p o i abili y o banks.
3.2.2.4. G ow h. Acco ding o Fama & F ench (1992), he g ow h o a i m is es ima ed based on he
an icipa ed igu es o p o i s and cash lows. Fi ms wi h highe g ow h a es a e an icipa ed o ha e
highe p o i abili y; and hus, highe e u ns o in es o s (Hasanudin, 2023). The p ice- o-book a io
measu es how ma ke pa icipan s alue he equi y o he i ms in ela ion o i s book alue. The p ice-
o-book is es ima ed by di iding he ma ke p ice o he i m’s sha e by i s book alue pe sha e (Doblas
e al., 2020; La To e e al., 2021). Va ious s udies ha e examined he ela ionship be ween he i m’s
p ice- o-book and i s p o i abili y. Fo ins ance, Fama & F ench (2007), Block (1995), and Fama & F ench
(1992) conside ed ha low p ice- o-book i ms can bea high p ice- o-book i ms since his e lec s
unde p icing and high po en ial o u u e g ow h; hus, inc easing p o i s and cash lows. Simila s udies
by Jensen e al. (1997) and Asness e al. (2013) p o ed ha high p ice- o-book i ms ha e also a u u e
g ow h po en ial which can be achie ed ia inno a ion and new p ojec s.
H
4
: The g ow h has a posi i e impac on he p o i abili y o banks.
3.2.2.5. Income di e si ica ion. The ela ionship be ween income di e si y and e u n on equi y (ROE)
in banks is a signi ican a ea o ocus in inance (Abu Khala e al., 2024). I in es iga es how banks migh
maximize hei income s eams o imp o e p o i abili y and sha eholde alue. Income di e si ica ion
in ol es banks b oadening hei income s eams beyond con en ional in e es -based ope a ions, such as
loans, o encompass non-in e es e enue sou ces such as ees, commissions, ading, and in es men
income. Di e si ying e enue sou ces mos ly educes isk. Banks can educe he ins abili y linked o a
single e enue s eam by depending on a ious sou ces o income. Du ing imes o low-in e es a es,
in e es e enue om loans may dec ease, while income om ees and commissions may s ay s eady o
ise. Reducing his isk can esul in a mo e s able and po en ially inc eased Re u n on Equi y (ROE) o
he bank, as i becomes less ulne able o changes in any indi idual e enue s eam. This s udy will use
he a io o non-in e es income o o al income as he measu e o income di e si ica ion. This measu e
o e s a ho ough assessmen o he signi icance o non-in e es e enue wi hin a bank’s o al income
p o ile.
H
5
: The income di e si ica ion has a posi i e impac on he p o i abili y o banks.
6 B. ABU KHALAF AND A. B. AWAD
3.2.2.6. Ope a ional e iciency. O ganiza ions mus sus ain ope a ional e iciency in hei ac i i ies. Bank
p o i abili y is in luenced by he ope a ional e iciency o he bank, which is assessed by he o al ope a -
ing expendi u e di ided by o al asse s, mos ly in e es expense (Kundu & Bane jee, 2022). Bank ope -
a ional e iciency in ol es managing in e es expense o a minimum h ough asse and liabili ies
managemen (Al a e al., 2022). The bank managemen consis en ly wo ks o op imize bank ope a ions,
pa icula ly by minimizing in e es paymen s paid o clien s, in o de o enhance bank p o i abili y
(Boamah e al., 2022). The ocus on in e es expenses is no in ended o banks o minimize he in e es
paid, as he in e es a es on deposi s o e ed o clien s by banks mus be compe i i e (Hidaya e al.,
2021). I can inc ease in e es expenses by using bank se ices o acqui e unds om cus ome s o daily
ansac ions. Inc easing he numbe o se ice acili ies a ailable o clien s can lead o mo e cash col-
lec ed, in addi ion o sa ings accoun s and cus ome deposi s.
H
6
: The ope a ional e iciency has a nega i e impac on he p o i abili y o banks.
3.2.2.7. Capi al adequacy (CapAd). The a io ep esen s he p opo ion o a bank’s capi al in ela ion o
i s weigh ed asse s (Baldwin e al., 2019). A highe Capi al Adequacy Ra io (CAR) may indica e a lowe
isk p o ile because he bank is alloca ing a g ea e pa o i s deposi s o loans. This has he po en ial
o inc ease liquidi y and imp o e he inancial pe o mance o inancial ins i u ions (Abu Khala e al.,
2024). Acco ding o Ajayi e al. (2019), a high Capi al Adequacy Ra io (CAR) shows a bank’s g ea e abil-
i y o mee i s inancial commi men s and deposi o demands, as i ep esen s a bigge sa e y bu e
(Baldwin e al., 2019). A high Capi al Adequacy Ra io (CAR) among banks in a gi en ma ke sugges s a
s ong and s able inancial sys em he e (Almaza i e al., 2022).
H
7
: The capi al adequacy has a posi i e impac on he p o i abili y o banks.
3.2.2.8. G oss domes ic p oduc (GDP). Many esea che s included he GDP as one o he mac oeco-
nomic a iables o con ol o he ela ionship be ween liquidi y isk and banks p o i abili y, o example,
Golube a e al. (2019) and Nguyen e al. In addi ion, GDP is an essen ial indica o o a coun y’s eco-
nomic heal h since i ep esen s he wo h o all p oduc s and se ices gene a ed wi hin i s bounda ies.
Businesses end o h i e as GDP g ows, esul ing in inc eased economic ac i i y and inc easing demand
o inancial se ices such as loans and in es men s (Klein & Weill, 2022). This ise in economic ac i i y
helps banks o inc ease hei lending beha io . In con as , du ing economic con ac ions, GDP ends o
con ac , a ec ing bo h i ms and indi iduals. Mo e speci ically, banks may expe ience di icul ies in such
pe iods as loan de aul s migh ise and his, as a esul , shall a ec he p o i abili y o banks (Lopez
e al., 2020).
H
8
: This pape expec s ha he e is a posi i e ela ion be ween GDP and p o i abili y.
3.2.2.9. In la ion (INF). Se e al empi ical pape s in es iga ed he impac o in la ion on he p o i abili y
o banks. Acco ding o Jee i ha e al., in la ion and bank p o i abili y ha e a complex ela ionship in
many ways. They a gued ha he gene al ise in p ices can a ec Banks’bo om lines. In o he wo ds,
banks end o ind ways and bene i om in la ion h ough mo e bo owing, lending, and in es men s.
Con e sely, banks may ace challenges due o high o unan icipa ed in la ion which diminishes he buy-
ing powe o money and impac s he alue o asse s (Tan & Flo os, 2012). In addi ion, in e es a es
could be impac ed by in la ion unce ain y, which makes i challenging o banks o se easonable p i-
ces o hei inancial p oduc s.
H
9
: This pape expec s ha he e is a posi i e ela ionship be ween in la ion and banks p o i abili y.
3.3. Model
Based on he p e ious sec ion, he ollowing model has been de eloped o in es iga e he impac o
liquidi y isk on banks’p o i abili y in he MENA egion.
COGENT ECONOMICS & FINANCE 7
Alhassan, A. L., & Te eh, M. L. (2017). Non-in e es income and bank e iciency in Ghana: A wo-s age DEA boo -
s apping app oach. Jou nal o A ican Business,18(1), 124–142. h ps://doi.o g/10.1080/15228916.2016.1227668
Al-Ma a i, E. M. (2023). The de e minan s o bank p o i abili y o GCC: The ole o bank liquidi y as mode a ing
a iable— u he analysis. In e na ional Jou nal o Finance & Economics,28(2), 1423–1435. h ps://doi.o g/10.1002/
ij e.2485
Almaza i, A. A., Almumani, M. A., & Ahmad, M. A. (2022). Assessmen o capi al adequacy, liquidi y, and p o i abili y
o he Saudi comme cial banks. In e na ional Jou nal o Accoun ing, 7, 82–93.
Alnabulsi, K., Koza e i
c, E., & Hakimi, A. (2022). Assessing he de e minan s o non-pe o ming loans unde inancial
c isis and heal h c isis: E idence om he MENA banks. Cogen Economics & Finance,10(1), 1–23. h ps://doi.o g/
10.1080/23322039.2022.2124665
Al a , K., Ayub, H., Shabbi , M. S., & Usman, M. (2022). Do ope a ional isk and co po a e go e nance a ec he bank-
ing indus y o Pakis an? Re iew o Economics and Poli ical Science,7(2), 108–123. h ps://doi.o g/10.1108/REPS-12-
2019-0156
A ellano, M., & Bond, S. (1991). Some es s o speci ica ion o panel da a: Mon e Ca lo e idence and an applica ion
o employmen equa ions. The Re iew o Economic S udies,58(2), 277–297. h ps://doi.o g/10.2307/2297968
Awad, A. B., Seissian, L. A., & Gha ios, R. T. (2022). Co po a e olun a y disclosu es in eme ging ma ke s: Empi ical
e idence om he GCC equi y ma ke s. In e na ional Jou nal o Accoun ing and Financial Repo ing,12(1), 1–36.
h ps://doi.o g/10.5296/ija . 12i1.19453
Badawi, A. (2017). E ec o c edi isk, liquidi y isk, and ma ke isk banking o p o i abili y bank (s udy on de ised
banks in Indonesia s ock exchange). In e na ional ins i u e o science. Technology, and Educa ion,9(29), 1–8.
Baldwin, K., Alhalboni, M., & Helmi, M. H. (2019). A s uc u al model o “alpha” o he capi al adequacy a ios o
Islamic banks. Jou nal o In e na ional Financial Ma ke s, Ins i u ions and Money,60, 267–283. h ps://doi.o g/10.
1016/j.in in.2018.12.015
Be ani, M., & Hacini, I. (2021). The ole o co po a e go e nance in imp o ing he banks Financial Pe o mance
empi ical e idence om lis ed banks in he Saudi ma ke . Jou nal o Economic In eg a ion,9(2), 651–667.
Be
ıos, M. R. (2013). The ela ionship be ween bank c edi isk and p o i abili y and liquidi y. The In e na ional
Jou nal o Business and Finance Resea ch,7(3), 105–118.
Block, F. E. (1995). A S udy o he P ice o Book Rela ionship. Financial Analys s Jou nal,51(1), 63–73. h ps://doi.o g/
10.2469/ aj. 51.n1.1860
Boamah, N. A., Opoku, E., & Boakye-Dankwa, A. (2022). Capi al egula ion, liquidi y isk, e iciency and banks pe o m-
ance in eme ging economies. Jou nal o Financial Regula ion and Compliance,31(1), 126–145. h ps://doi.o g/10.
1108/JFRC-09-2021-0076
Bou ke, P. (1989). Concen a ion and o he de e minan s o bank p o i abili y in Eu ope, No h Ame ica and
Aus alia. Jou nal o Banking & Finance,13(1), 65–79. h ps://doi.o g/10.1016/0378-4266(89)90020-4
Buallay, A., Fadel, S. M., Al-Ajmi, J. Y., & Saudaga an, S. (2020). Sus ainabili y epo ing and pe o mance o
MENA banks: Is he e a ade-o ? Measu ing Business Excellence,24(2), 197–221. h ps://doi.o g/10.1108/MBE-09-
2018-0078
Chen, Y.-K., Shen, C. H., Kao, L., & Yeh, C. Y. (2018). Bank liquidi y isk and pe o mance. Re iew o Paci ic Basin
Financial Ma ke s and Policies,21(01), 1850007. h ps://doi.o g/10.1142/S0219091518500078
Chowdhu y, M., Zaman, S., & Alam, A. (2018). Liquidi y isk managemen o Islamic banks in bangladesh. Resea ch
Jou nal o Finance and Accoun ing,9(19), 46–54.
Damayan hi, N. M. M., & Gunawa dhana, C. S. (2022). De e minan s o Liquidi y o Licensed Comme cial Banks in S i
Lanka [Pape p esen a ion].13 h In e na ional Con e ence on Business & In o ma ion ICBI, S i Lanka., Uni e si y o
Kelaniya ISSN 2465-6399, pp. 127–149.
De bali, A. (2021). De e minan s o he pe o mance o Mo occan banks. Jou nal o Business and Socio-Economic
De elopmen ,1(1), 102–117. h ps://doi.o g/10.1108/JBSED-01-2021-0003
Doblas, M. P., Laga as, M. C. P., & En iquez, J. A. (2020). P ice o ea nings and p ice o book a ios as de e minan s o
s ock e u n: The case o inancial ins i u ions lis ed in Bah ain bou se. Jou nal o Applied Economic Sciences,15,
532–539.
Ekinci, R., & Poy az, G. (2019). The e ec o c edi isk on inancial pe o mance o deposi banks in Tu key. P ocedia
Compu e Science,158(6), 979–987. h ps://doi.o g/10.1016/j.p ocs.2019.09.139
El Khou y, R., Nas allah, N., & Ala eeni, B. (2023). ESG and inancial pe o mance o banks in he MENAT egion:
Conca i y–con exi y pa e ns. Jou nal o Sus ainable Finance & In es men ,13(1), 406–430. h ps://doi.o g/10.1080/
20430795.2021.1929807
Fama, E. F., & F ench, K. R. (2007). The ana omy o alue and g ow h s ock e u ns. Financial Analys s Jou nal,63(6),
44–54. h ps://doi.o g/10.2469/ aj. 63.n6.4926
Fama, E., & F ench, K. (1992). The c oss-sec ion o expec ed s ock e u ns. The Jou nal o Finance,47(2), 427–465.
h ps://doi.o g/10.2307/2329112
Fa hi, M., & Hacini, I. (2021). The Impac o he owne ship di e si ica ion on he inancial pe o mance: An empi ical
s udy on inancial companies in Qa a . Psychology and Educa ion,58(5), 1553–6939.
Fl€
ogel, F. (2018). Dis ance and mode n banks’lending o SME’s: E hnog aphic insigh s om a compa ison o egional
and la ge banks in Ge many. Jou nal o Economic Geog aphy,18(1), 35–57. h ps://doi.o g/10.1093/jeg/lbx017
14 B. ABU KHALAF AND A. B. AWAD
Gizaw, M., Kebede, M., & Sel a aj, S. (2015). The impac o c edi isk on p o i abili y pe o mance o comme cial
banks in E hiopia. A ican Jou nal o Business Managemen ,9(2), 59–66.
Golube a, O., Duljic, M., & Keminen, R. (2019). The impac o liquidi y isk on bank p o i abili y: Some empi ical e i-
dence om he eu opean banks ollowing he in oduc ion o basel III egula ions. Accoun ing and Managemen
In o ma ion Sys ems,18(4), 455–485.
Hacini, I., Boulen ad, A., & Dahou, K. (2021). The impac o liquidi y isk managemen on he inancial pe o mance
o Saudi A abian banks. EMAJ: Eme ging Ma ke s Jou nal,11(1), 67–75. h ps://doi.o g/10.5195/emaj.2021.221
Hasanudin, H. (2023). The e ec o p ice ea nings a io (Pe ), p ice o book alue (Pb ) and deb o equi y a io on
s ock e u n wi h ea nings pe sha e (EPS) as a mode a ion a iable: S udies on insu ance sub-sec o companies
and secu i ies companies egis e ed on he indone. Cen al Eu opean Managemen Jou nal,31(2), 358–371.
Hidaya , S. E., Sak i, M. R. P., & Al-Balushi, R. A. A. (2021). Risk, e iciency and inancial pe o mance in he GCC bank-
ing indus y: Islamic e sus con en ional banks. Jou nal o Islamic Accoun ing and Business Resea ch,12(4), 564–
592. h ps://doi.o g/10.1108/JIABR-05-2020-0138
Isayas, Y. N. (2022). De e minan s o banks’p o i abili y: Empi ical e idence om banks in E hiopia. Cogen
Economics & Finance,10(1), 2031433. h ps://doi.o g/10.1080/23322039.2022.2031433
Islam, M. S., & Nishiyama, S. I. (2016). The de e minan s o bank ne in e es ma gins: A panel e idence om Sou h
Asian coun ies. Resea ch in In e na ional Business and Finance,37(3), 501–514. h ps://doi.o g/10.1016/j. iba .2016.
01.024
Ismail, S., & Ahmed, E. (2023). The impac o liquidi y isk, c edi isk, and ope a ional isk on inancial s abili y in
con en ional banks in Jo dan. Unce ain Supply Chain Managemen ,11(2), 433–442. h ps://doi.o g/10.5267/j.uscm.
2023.3.006
Jensen, G. R., Johnson, R. R., & Me ce , J. M. (1997). New e idence on size and p ice- o-book e ec s in s ock e u ns.
Financial Analys s Jou nal,53(6), 34–42. h ps://doi.o g/10.2469/ aj. 53.n6.2128
Ka akaya, A., & E , B. (2012). Nonin e es (nonp o i ) income and inancial pe o mance a Tu kish comme cial and
pa icipa ion banks. In e na ional Business Resea ch,6(1), 106. h ps://doi.o g/10.5539/ib . 6n1p106
Khala , B. A. (2022a). An empi ical in es iga ion o he impac o i m cha ac e is ics on he smoo hness o di idend.
Co po a e Go e nance and O ganiza ional Beha io Re iew,6(4), 122–133. h ps://doi.o g/10.22495/cgob 6i4p11
Khala , B. A. (2022b). The impac o boa d di e si y on he pe o mance o banks [Special issue]. Co po a e
Go e nance and O ganiza ional Beha io Re iew,6(4), 275–283. h ps://doi.o g/10.22495/cgob 6i4sip8
Khala , B. A., & Alajlani, S. (2021). Po olio lending s a egy and banks pe o mance in Jo dan: Wha o do? Academy
o Accoun ing and Financial S udies Jou nal,25(3), 1–11.
Khala , B. A., Awad, A. B., & Ahmed, S. S. (2023a). The impac o di idend policy on sha e p ice ola ili y: E idence
om lis ed companies in Gul Coope a ion Council coun ies. [Special issue]. Co po a e and Business S a egy
Re iew,4, 289–295. h ps://doi.o g/10.22495/cbs 4i2sia 8
Khala , B. A., Awad, A. B., & Nass , M. (2023b). In es iga ing he de e minan s o wo king capi al in he Gul
Coope a ion Council. Jou nal o Go e nance and Regula ion,12(3), 8–15. h ps://doi.o g/10.22495/jg 12i3a 1
Khalid, M. S., Rashed, M., & Hossain, A. (2019). The impac o liquidi y isk on banking pe o mance: E idence om
he eme ging ma ke . Global Jou nal o Managemen and Business Resea ch,19(4), 47–52.
Klein, P.-O., & Weill, L. (2022). Bank p o i abili y and economic g ow h. The Qua e ly Re iew o Economics and
Finance,84, 183–199. h ps://doi.o g/10.1016/j.q e .2022.01.009
Kosmidou, K. (2008). The de e minan s o banks’p o i s in G eece du ing he pe iod o EU inancial in eg a ion.
Manage ial Finance,34(3), 146–159. h ps://doi.o g/10.1108/03074350810848036
Ko en, A. (2021). De e mina ion o he ela ionship be ween non-pe o ming loans and p o i abili y in he Tu kish
banking sys em wi h panel eg ession analysis. P essacademia,14(1), 14–19. h ps://doi.o g/10.17261/
P essacademia.2021.1478
Kundu, S., & Bane jee, A. (2022). Ope a ional and policy e iciency: A compa ison be ween public and p i a e Indian
banks. In e na ional Jou nal o P oduc i i y and Pe o mance Managemen ,71(4), 1537–1558. h ps://doi.o g/10.
1108/IJPPM-06-2020-0322
La To e, M., Leo, S., & Pane a, I. C. (2021). Banks and en i onmen al, social and go e nance d i e s: Follow he ma -
ke o he au ho i ies? Co po a e Social Responsibili y and En i onmen al Managemen ,28(6), 1620–1634. h ps://
doi.o g/10.1002/cs .2132
Lopez, J., Rose, A., & Spiegel, M. (2020). Why ha e nega i e nominal a es had such a small e ec on bank pe o m-
ance? C oss-coun y e idence. Eu opean Economic Re iew,124, 103402. h ps://doi.o g/10.1016/j.eu oeco e .2020.
103402
Malik, M. S., Awais, M., & Khu sheed, A. (2016). Impac o liquidi y on p o i abili y: A comp ehensi e case o
Pakis an’s p i a e banking sec o . In e na ional Jou nal o Economics and Finance,8(3), 69–74. h ps://doi.o g/10.
5539/ije . 8n3p69
Mbekomize, C. J., & Mapha ing, M. (2017). Analysis o de e minan s o p o i abili y o comme cial banks in Bo swana.
In e na ional Jou nal o Academic Resea ch in Accoun ing, Finance and Managemen Sciences,7(2), 131–144. h ps://
doi.o g/10.6007/IJARAFMS/ 7-i2/2878
Menicucci, E., & Paolucci, G. (2023). ESG dimensions and bank pe o mance: An empi ical in es iga ion in I aly. Co po a e
Go e nance: The In e na ional Jou nal o Business in Socie y,23(3), 563–586. h ps://doi.o g/10.1108/CG-03-2022-0094
COGENT ECONOMICS & FINANCE 15
Meslie , C., Tacneng, R., & Ta azi, A. (2014). Is bank income di e si ica ion bene icial? E idence om an eme ging
economy. Jou nal o In e na ional Financial Ma ke s, Ins i u ions and Money,31,97–126. h ps://doi.o g/10.1016/j.
in in.2014.03.007
Muhammed, S., Desalegn, G., Feke e-Fa kas, M., & B ude , E. (2023). C edi isk de e minan s in selec ed E hiopian
comme cial banks: A panel da a analysis. Jou nal o Risk and Financial Managemen ,16(9), 406. h ps://doi.o g/10.
3390/j m16090406
No aini, M. A. (2012). Liquidi y isk managemen and inancial pe o mance in Malaysia: Empi ical e idence om
Islamic banks. Aceh In e na ional Jou nal o Social Sciences,1(2), 77–84.
Nu siana, A. (2017). E ec o non-pe o ming loans o p o i abili y o banks in Indonesia. In e na ional Jou nal o
Applied Business and Economic Resea ch,15(10), 203–208.
Ojo, M. (2010). Risk managemen by he basel commi ee: E alua ing p og ess made om he 1988 Basel Acco d o
ecen de elopmen s. Jou nal o Financial Regula ion and Compliance,18(4), 305–315. h ps://doi.o g/10.1108/
13581981011093640
Olagunju, A., Da id, A. O., & Samuel, O. (2012). Liquidi y managemen and comme cial banks’p o i abili y in Nige ia.
Resea ch Jou nal o Finance and Accoun ing,2(7/8), 24–38.
Ozili, P. K. (2021). Bank p o i abili y de e minan s: Compa ing he Uni ed S a es, Nige ia and Sou h A ica. Nige ia
and Sou h A ica,16(1), 55–78.
Pe ia, N., Cap a u, B., & Ihna o , I. (2015). De e minan s o banks’p o i abili y: E idence om EU 27 banking sys ems.
P ocedia Economics and Finance,20, 518–524. h ps://doi.o g/10.1016/S2212-5671(15)00104-5
Phan, D. H. B., Na ayan, P. K., Rahman, R. E., & Hu aba a , A. R. (2020). Do inancial echnology i ms in luence bank
pe o mance? Paci ic-Basin Finance Jou nal,62, 101210. h ps://doi.o g/10.1016/j.pac in.2019.101210
Phan, T. T. H., Pham, A. H. T., Le, H. A., & Lam, T. B. N. (2022). The impac o non-in e es income on he pe o mance
o comme cial banks in he ASEAN Region. Jou nal o Risk and Financial Managemen ,16(1), 18. h ps://doi.o g/10.
3390/j m16010018
Rahman, M. M., Hamid, M. K., & Khan, M. A. M. (2015). De e minan s o bank p o i abili y: Empi ical e idence om
Bangladesh. In e na ional Jou nal o Business and Managemen ,10(8), 135–150. h ps://doi.o g/10.5539/ijbm. 10n8p135
Rdaydeh, M., Ma a , A., & Alghzwai, O. (2017). In oduc ion. Analyzing he e ec o c edi and liquidi y isks on p o i -
abili y o con en ional and Islamic jo danian banks. In e na ional Jou nal o Academic Resea ch in Business and
Social Sciences,7(12), 1145–1155.
Rubbaniy, G., Khalid, A. A., Ali, S., & Polyzos, E. (2023). Cyclicali y o liquidi y c ea ion: Nonlinea e idence om US
bank holding companies. Jou nal o Financial Resea ch,46(4), 1165–1185. h ps://doi.o g/10.1111/j i .12352
Ruziqa, A. (2013). The impac o c edi and liquidi y isk on bank inancial pe o mance: The case o Indonesian
Con en ional Bank wi h o al asse abo e 10 illion Rupiah. In e na ional Jou nal o Economic Policy in Eme ging
Economies,6(2), 93–106. h ps://doi.o g/10.1504/IJEPEE.2013.055791
Sai -Alyous i, A. Y. H. (2022). De e minan s o bank p o i abili y: E idence om 47 Asian coun ies. Jou nal o
Economic S udies,49(1), 44–60. h ps://doi.o g/10.1108/JES-05-2020-0215
Saleh, I., Abu A i a, Mj., & Mu ay, L. (2020). The e ec o c edi isk, liquidi y isk and bank capi al on bank p o i abil-
i y: E idence om an eme ging ma ke . Cogen Economics & Finance,8(1), 1814509. h ps://doi.o g/10.1080/
23322039.2020.1814509
Salim, B. F., & Bilal, Z. O. (2016). The impac o liquidi y managemen on inancial pe o mance in Omani banking
sec o . In e na ional Jou nal o Accoun ing, Business and Economic Resea ch,14(1), 545–565.
Seissian, L. A., Gha ios, R. T., & Awad, A. B. (2018). S uc u al and ma ke - ela ed ac o s impac ing p o i abili y: A
c oss sec ional s udy o lis ed companies. A ab Economic and Business Jou nal,13(2), 125–133. h ps://doi.o g/10.
1016/j.aebj.2018.09.001
Se wadda, I. (2018). De e minan s o comme cial banks’p o i abili y. E idence om Hunga y. Ac a Uni e si a is
Ag icul u ae e Sil icul u ae Mendelianae B unensis,66(5), 1325–1335. h ps://doi.o g/10.11118/ac aun201866051325
Shoaib Ali, I. Y., Chugh ai, S., & Shah, S. Z. A. (2022). Role o bank compe i ion in de e mining liquidi y c ea ion:
E idence om GCC coun ies. Jou nal o Applied Economics, 25(1), 242–259.
Su ian, F., & Chong, R. R. (2008). De e minan s o bank p o i abili y in a de eloping economy: Empi ical e idence
om he Philippines. Asian Academy o Managemen Jou nal o Accoun ing & Finance,4(2), 91–112.
Sya i’i, M. F. R., & Ruslia i, E. (2016). C edi isk, ma ke isk, ope a ional isk and liquidi y isk on p o i abili y o banks
in Indonesia. T ikonomika,15(2), 78–88.
Tan, Y., & Flo os, C. (2012). Bank p o i abili y and in la ion: The case o China. Jou nal o Economic S udies,39(6),
675–696. h ps://doi.o g/10.1108/01443581211274610
Uzunkaya, M. (2012). Economic pe o mance in bank-based and ma ke -based inancial sys ems: Do non- inancial
ins i u ions ma e ? Jou nal o Applied Finance and Banking,2(5), 159.
Widya i, E., Widyak o, A., & Suha djo, Y. (2022). Analysis o he e ec o non-pe o ming loan, e u n on asse s,
e u n on equi y and size on banking liquidi y isk. Ju nal Dinamika Manajemen,13(1), 78–86.
Yuen, M. K., Ngo, T., Le, T. D. Q., & Ho, T. H. (2022). The en i onmen , social and go e nance (ESG) ac i i ies and
p o i abili y unde COVID-19: E idence om he global banking sec o . Jou nal o Economics and De elopmen ,
24(4), 345–364. h ps://doi.o g/10.1108/JED-08-2022-0136
16 B. ABU KHALAF AND A. B. AWAD
