Liquidity and its impact on the stability of contracts An analytical study of a sample of commercial panels offered in the Iraq Stock Exchange for the period (2005 - 2021)

Abstract

The study aims to measure the impact of liquidity risks on the stability of the banking sector, and the global financial crises caused a series of failures for most commercial banks. Therefore, most banks are exposed to a lot of banking risks that may lead to instability of the banking system. Perhaps the most important of these risks is the risk of liquidity, which is one of the important issues in commercial banks, as it is a source of concern for every bank because the function for which banks were found is to provide liquidity and grant loans. The study population may consist of commercial banks listed in the Iraq Stock Exchange, which consist of twenty-five banks, but the study sample was chosen, which included ten banks: (Bank of Baghdad, Commercial Bank of Iraq, Middle East Bank, Investment Bank of Iraq, United Bank, Iraqi National Bank, Iraqi Credit Bank, Sumer Commercial Bank, Khaleej Commercial Bank, Mosul Bank for Development and Investment) for the period 2005-2021. The study used a number of statistical models, which are (Microsoft Excel v.10, SPSS v.25, Eviews v.12 The study found a number of results, there is a significant effect of liquidity risk on banking stability. In light of this, the study came out with a number of recommendations, the most important of which is the need to manage banking liquidity and take adequate guarantees when granting credit and good management of liquidity to face the risks that banks are exposed to in order to achieve stability in the banking system.