The stability of Vietnamese commercial banks - Does liquidity creation matter?
The study offers insights into whether liquidity creation, capital growth rate, and their interaction have affected the stability of Vietnamese commercial banks by employing the Bayesian method for a sample of 25 commercial banks during 2008 - 2022. Our empirical findings reveal that the more liquid...
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| Format: | Article |
| Language: | English |
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HO CHI MINH CITY OPEN UNIVERSITY JOURNAL OF SCIENCE
2024-10-01
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| Series: | Ho Chi Minh City Open University Journal of Science - Economics and Business Administration |
| Subjects: | |
| Online Access: | https://journalofscience.ou.edu.vn/index.php/econ-en/article/view/3145 |
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| _version_ | 1841527107764617216 |
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| author | Linh Thi My Nguyen Oanh Thi Kim Tran |
| author_facet | Linh Thi My Nguyen Oanh Thi Kim Tran |
| author_sort | Linh Thi My Nguyen |
| collection | DOAJ |
| description | The study offers insights into whether liquidity creation, capital growth rate, and their interaction have affected the stability of Vietnamese commercial banks by employing the Bayesian method for a sample of 25 commercial banks during 2008 - 2022. Our empirical findings reveal that the more liquidity a bank creates and the higher the capital growth rate is, the more stable the bank is. Especially the results show that capital growth has a moderating role, as it allows banks to absorb potential loss due to liquidity risks in the course of liquidity creation. Moreover, other bank-specific factors, including the Capital Adequacy Ratio (CAR), Non-Performing Loan (NPL), Cost to Income Ratio (CIR), Net Interest income (NIM) ratio, Liquidity Ratio (LIR), Loan To Deposit ratio (LTD), and marco ecomomic factors including GDP growth and inflation are determinants of bank stability. The study suggests some implications for the State bank of Vietnam with regard to liquidity creation policies to maintain the stability of the Vietnamese banking sector. |
| format | Article |
| id | doaj-art-7d185ea8a5ae4fd8be105ee86257968d |
| institution | Kabale University |
| issn | 2734-9314 2734-9586 |
| language | English |
| publishDate | 2024-10-01 |
| publisher | HO CHI MINH CITY OPEN UNIVERSITY JOURNAL OF SCIENCE |
| record_format | Article |
| series | Ho Chi Minh City Open University Journal of Science - Economics and Business Administration |
| spelling | doaj-art-7d185ea8a5ae4fd8be105ee86257968d2025-01-16T05:23:10ZengHO CHI MINH CITY OPEN UNIVERSITY JOURNAL OF SCIENCEHo Chi Minh City Open University Journal of Science - Economics and Business Administration2734-93142734-95862024-10-01151819810.46223/HCMCOUJS.econ.en.15.1.3145.20252265The stability of Vietnamese commercial banks - Does liquidity creation matter?Linh Thi My Nguyen0Oanh Thi Kim Tran1University of Finance - Marketing, Ho Chi Minh CityUniversity of Finance - Marketing, Ho Chi Minh CityThe study offers insights into whether liquidity creation, capital growth rate, and their interaction have affected the stability of Vietnamese commercial banks by employing the Bayesian method for a sample of 25 commercial banks during 2008 - 2022. Our empirical findings reveal that the more liquidity a bank creates and the higher the capital growth rate is, the more stable the bank is. Especially the results show that capital growth has a moderating role, as it allows banks to absorb potential loss due to liquidity risks in the course of liquidity creation. Moreover, other bank-specific factors, including the Capital Adequacy Ratio (CAR), Non-Performing Loan (NPL), Cost to Income Ratio (CIR), Net Interest income (NIM) ratio, Liquidity Ratio (LIR), Loan To Deposit ratio (LTD), and marco ecomomic factors including GDP growth and inflation are determinants of bank stability. The study suggests some implications for the State bank of Vietnam with regard to liquidity creation policies to maintain the stability of the Vietnamese banking sector.https://journalofscience.ou.edu.vn/index.php/econ-en/article/view/3145bank stabilitybayesian approachliquidity creation |
| spellingShingle | Linh Thi My Nguyen Oanh Thi Kim Tran The stability of Vietnamese commercial banks - Does liquidity creation matter? Ho Chi Minh City Open University Journal of Science - Economics and Business Administration bank stability bayesian approach liquidity creation |
| title | The stability of Vietnamese commercial banks - Does liquidity creation matter? |
| title_full | The stability of Vietnamese commercial banks - Does liquidity creation matter? |
| title_fullStr | The stability of Vietnamese commercial banks - Does liquidity creation matter? |
| title_full_unstemmed | The stability of Vietnamese commercial banks - Does liquidity creation matter? |
| title_short | The stability of Vietnamese commercial banks - Does liquidity creation matter? |
| title_sort | stability of vietnamese commercial banks does liquidity creation matter |
| topic | bank stability bayesian approach liquidity creation |
| url | https://journalofscience.ou.edu.vn/index.php/econ-en/article/view/3145 |
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