The Impact of Liquidity Decision on Managerial Performance: Evidence from Private Commercial Banks in Bangladesh

Sumi Saha
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Sumi Saha: Assistant Professor, Department of Accounting and Information Systems (AIS), University of Rajshahi, Rajshahi-6205, BANGLADESH

American Journal of Trade and Policy, 2021, vol. 8, issue 1, 17-24

Abstract: This study has examined the impact of liquidity decisions on the managerial performance of ten listed conventional private commercial banks. The required data have been collected from the five years' annual reports of the sample banks and analyzed through formulating different null hypotheses. Findings from the testing of null hypotheses with the use of the ANOVA technique reveal that there is no significant variation of different indicators of liquidity decision as well as the managerial performance of the sample banks. Findings are taken from conducting the multiple regression analysis with ordinary least square (OLS) model also indicate that the indicators of liquidity decision namely current ratio is positively and insignificantly associated with net profit ratio as well as return on equity but negatively and insignificantly associated with return on assets as well as return on investment. Moreover, the networking capital ratio as another indicator of liquidity decision is negatively and insignificantly associated with net profit ratio, return on assets as well as return on equity but positively and insignificantly associated with return on investment of the sample banks over the study period.

Keywords: liquidity decision; managerial performance; conventional private commercial banks; Bangladesh (search for similar items in EconPapers)
JEL-codes: G21 (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:ris:ajotap:0025

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