Liquidity Dynamics of Banks in Emerging Market Economies

Tafirei Mashamba ()
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Tafirei Mashamba: Great Zimbabwe University, Masvingo, Zimbabwe and University of South Africa, Pretoria, South Africa

Journal of Central Banking Theory and Practice, 2022, vol. 11, issue 1, 179-206

Abstract: This study examines the liquidity dynamics of banks in emerging market economies. Using annual data of 91 commercial banks from 11 countries, the study established that banks in emerging markets have target liquidity ratios they pursue and partially adjust due to market frictions. Overall, risk aversion and prudence play a significant role in explaining the liquidity dynamics by banks in emerging market economies.

Keywords: bank liquidity; liquidity dynamics; commercial banks; emerging markets; GMM. (search for similar items in EconPapers)
JEL-codes: G11 G18 G19 G21 G28 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:cbk:journl:v:11:y:2022:i:1:p:179-206

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