Determinants of Bank Liquidity: Evidence from Vietnam

Pham, Hai Nam; Pham, Thi Hong Nhung

doi:10.1007/978-3-030-77094-5_17

Cited by 4 publications

(3 citation statements)

References 16 publications

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“…Table 4 shows that loan provision is positively correlated with bank liquidity at a 1% significant level. H. N. Pham & Pham (2021) found similar results when they conduct their study on a sample of 30 commercial banks for the period 2007 to 2018 in Vietnam.…”

Section: Resultsmentioning

confidence: 56%

Basel III standards and liquidity determinants in Vietnamese commercial bank

Le-Bao,

Ho,

Lang

2023

JEECAR

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This study aims to ascertain the determinants affecting the liquidity of Vietnamese Commercial Banks by their bank ownership structures, CEO characteristics, and bank-specific variables. Using panel data consisting of 29 Vietnamese commercial banks, we measure liquidity using the most up-to-date method – the Net Stable Funding Difference (NSFD), according to Basel III standards. Correlating to the relationship between CEOs’ characteristics and bank liquidity, we found that CEOs with longer tenure will control liquidity better due to their higher managerial power and entrenchment. Moreover, the findings of the present study show that local market power, bank age, bank size, and loan loss provision positively impact bank liquidity. In contrast, further investigation reveals the adverse impact of state ownership on bank liquidity. This study provides insights into the prudential supervision of Vietnamese commercial banks, which implications for policymakers, by applying the latest liquidity measurement method and new findings on liquidity determinants.

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Section: Resultsmentioning

confidence: 56%

Basel III standards and liquidity determinants in Vietnamese commercial bank

Le-Bao,

Ho,

Lang

2023

JEECAR

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“…Empirical findings confirmed that GDP has a significant and positive effect on bank liquidity, while inflation and unemployment have a marginal impact on the bank liquidity in the analyzed region. Likewise, Pham and Pham [65] confirmed the positive effects of gross domestic product and inflation on the bank liquidity in Vietnam for the period 2007-2018. In addition to the positive effect of GDP, inflation rate can also have lucrative implications for bank liquidity.…”

Section: Determinants Of Banks' Liquiditymentioning

confidence: 66%

“…The most commonly used macroeconomic factors related to bank liquidity are gross domestic product growth and inflation rate. Many studies have confirmed that gross domestic product and inflation are significant predictors of bank liquidity [58,[63][64][65][66][67]. When it comes to the positive effect of GDP on bank liquidity, Tran et al [67] analyzed bank liquidity through the ratio of loans to total assets, and their results confirmed a significant and positive effect of the GDP growth rate on bank liquidity in the sample of U.S. banks from 1996 to 2013.…”

Section: Determinants Of Banks' Liquiditymentioning

confidence: 93%

Do the Same Determinants Affect Banks’ Profitability and Liquidity? Evidence from West Balkan Countries Using a Panel Data Regression Analysis

Radovanov,

Milenković,

Kalaš

et al. 2023

Mathematics

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This study aims to determine whether the same bank-specific and macroeconomic determinants affect banks’ profitability and liquidity. To achieve the set goal, panel data regression analysis was applied with fixed effects or random effects depending on the results of the Hausman test, as explained in the Results. The research is based on the use of aggregate data on bank-specific and macroeconomic determinants of banks’ profitability and liquidity in West Balkan countries during the period from 2007 to 2022. The dependent variables in the study are ROA, ROE used as proxies for banks’ profitability, and banks’ liquid reserves to banks’ total assets as a proxy for banks’ liquidity. The findings confirm that the bank-specific and macroeconomic determinants affect both banks’ profitability and liquidity in the same direction, except for a few variables. The main contribution of this research is a comprehensive and parallel view of banks’ profitability and liquidity determinants that enables a guide for bank management to better understand the significance of bank-specific and macroeconomic determinants’ effects on their business. The obtained results can improve the balance between the two important principles of banking business.

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Determinants of Liquidity in Microfinance Institutions: Evidence from Developing Economies

Jibir,

Omeke,

Mia

et al. 2024

Int. J. Emp. Econ.

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Maintaining an optimal level of liquidity remains a crucial agenda for firms to minimise liquidity risks. Therefore, the study aims to identify the drivers of liquidity by utilizing firm-level data of 1,544 microfinance institutions (MFIs), covering a total of 112 developing countries and a period of 2010–2018. The data were then analysed using conventional econometric tools and techniques. Among others, the study found that board size, portfolio quality, donations and size of MFIs have a positive effect on the liquidity of MFIs, while gender diversity at the board level, operational self-sustainability, staff productivity, legal status and gross domestic product (GDP) growth revealed a negative effect. After conducting several robustness checks, including alternative proxies, sub-samples and endogeneity-corrected techniques, our findings remain mostly consistent. Policy implications are further discussed.

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Determinants of Bank Liquidity: Evidence from Vietnam

Cited by 4 publications

References 16 publications

Basel III standards and liquidity determinants in Vietnamese commercial bank

Basel III standards and liquidity determinants in Vietnamese commercial bank

Do the Same Determinants Affect Banks’ Profitability and Liquidity? Evidence from West Balkan Countries Using a Panel Data Regression Analysis

Determinants of Liquidity in Microfinance Institutions: Evidence from Developing Economies

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