The Importance of Risks and Liquidity in Enhancing Banking Value in Private Banks: An Applied Study on the Banks of the Middle East, the Gulf, Al-Ahly and Baghdad for the Period 2016 – 2019

• Post by: Muthanna mjdes
• October 25, 2022
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Mohammed Sameer Deherieb AL Robaaiy ^*a       &     Mohammed Hassan Wadi ^b

Al-Muthanna University / College of Administration and Economics.

Abstract                                

 The research aims to study the banking risks and liquidity required from the bank to provide and the effect of both risks and liquidity on the value of the bank. Consequently, the research problem appeared which indicates the extent of the effect of risks and liquidity on the value of the bank. In order to achieve the objectives and hypotheses of the research, mathematical indicators are studied and analyzed to find the relationship and effect according to statistical methods. The research used the Statistical Package for Social Sciences (SPSS) and the quantitative measures, which included indicators such as the quick liquidity to measure liquidity, the return on deposits to measure profitability, and Tobin’s Q bank value measurement. The research sample consists of four private banks (Middle East, Gulf, Al-Ahli and  Baghdad) for the period from 2016 to 2019. The research reached a number of conclusions, the most important of which are the presence of a risk effect and the absence of liquidity effect on the value of the bank. The research recommends the necessity to reduce the percentage of losses that are generated from risks, by following a good credit policy or conducting training courses for employees working in the banks with the aim of reducing operating expenses and not exaggerating the effects of risks. The research also recommends not to keep excess liquidity ratios at a high rate because of their effect on the profitability that the bank seeks to achieve.

DOI:10.52113/6/2021-11-3/66-80