Analysis of the relationship of cash liquidity and credit capacity - the Commercial Bank of Iraq as a model for the period (2009-2020)

Abstract

The research aims to reveal the relationship between cash liquidity and credit capacity in Iraqi commercial banks, where the issue of cash liquidity is one of the main and important issues in commercial banks and their preoccupation in their daily work and friction with customers, and the credit capacity is considered one of the most attractive areas of investment for banks, due to the high returns  Thus, the main goal of banks is (profitability). On the contrary, the bank may retain liquidity that exceeds its need, which results in the case of improper use of available resources, and good management of liquidity leads to the bank's inability to take advantage of appropriate opportunities to achieve the shortest profit.  The loss of investment opportunities includes the idea of   research by analyzing the relationship of cash liquidity in banks, the study sample, and comparing them.  The three standard models using the Todayamomoto model between the independent variable  (The cash liquidity of the Iraqi currency in the funds of the three banks mentioned) does not affect the dependent variables (cash credit and pledge credit).  A set of recommendations was also formulated, the most important of which is the need for the banks under study to strengthen their financial position through increasing interest in cash liquidity to achieve acceptable bank credit ratios.