• ISSN: 2010-023X (Print)
    • Abbreviated Title: Int. J. Trade, Economics and Financ.
    • Frequency: Quaterly
    • DOI: 10.18178/IJTEF
    • Editor-in-Chief: Prof.Tung-Zong (Donald) Chang
    • Managing Editor: Ms. Shira. W. Lu
    • Abstracting/ Indexing:  Crossref, Electronic Journals Library , EBSCO
    • E-mail: ijtef.editorial.office@gmail.com
HOME > Archive > 2019 > Volume 10 Number 1 (Feb. 2019) >
IJTEF 2019 Vol.10(1): 8-16 ISSN: 2010-023X
DOI: 10.18178/ijtef.2019.10.1.630

Determinants of Liquidity and Market Risk and the Effect on Bank Performance in Bahrain and Malaysia Banking

Norazwa A. Zolkifli, Khairul Jannah Samsudin, and Mohd Burhan Yusof

Abstract—This paper examines the determinants of liquidity and market risk of conventional and Islamic banks for two countries; Malaysia and Bahrain and the effect of the determinants on bank performance. Data were collected from 2008 to 2016 and analyzes using panel data analysis. The results reveal that bank capitalization and interest rate are significant determinants of liquidity and market risk respectively in both countries. In addition, banks capitalization and non-interest income/income attributable significantly affects performance in both banking system. The findings of this study among others can assist the banks in complying with the existing guidelines on risk management and supervision provided by the Basel Committee on Banking Supervision and Islamic Financial Services Board. Instead of that, this result also can coordinating technical and vocational education and training development with government departments responsible for trade and industry especially in banking system, workplace relations, and science and technology, to align skills being taught with government policy directions.

Index Terms—Bank performance, liquidity risk, market risk, Islamic bank, conventional bank.

The authors are with the Polytechnic Sultan Idris Shah, Sg Lang, 45100 Sungai Air Tawar, Selangor, Malaysia (e-mail: norazwa76@gmail.com, khjannah.samsudin@gmail.com, mohd_burhan@psis.edu.my).

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Cite: Norazwa A. Zolkifli, Khairul Jannah Samsudin, and Mohd Burhan Yusof, "Determinants of Liquidity and Market Risk and the Effect on Bank Performance in Bahrain and Malaysia Banking," International Journal of Trade, Economics and Finance vol.10, no.1, pp. 8-16, 2019.

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