The effect of using indicators of employment funds on the profitability of the commercial bank (An applied study in the International Development Bank and the Arab Gulf Commercial Bank)

Abstract

Financial indicators are among the most important financial analysis tools that most financial and economic institutions rely on to know their current and future financial position. Because financial indicators are characterized by ease and speed of completion compared to other analysis tools. It requires only the appropriate selection of the required indicators from those in charge of the financial analysis process, and their suitability for use in evaluating the performance of the commercial bank. From this standpoint, the idea of the research came (the effect of using indicators of money investment on the profitability of the commercial bank) to shed light on the evaluation of the financial performance of the commercial banks, the research sample. By choosing a set of ratios for investing deposit resources to test their impact on the bank’s profitability. The research was limited to using (the deposit investment rate and the ratio of total loans to total deposits) as an independent variable, while the dependent variable was (commercial bank profitability), as the researcher starts from the hypothesis that (there is a relationship Correlation and a significant impact of the indicators of deposit funds on the bank’s profitability) and the selection of two commercial banks from the banks traded in the Iraqi market for securities, namely (the International Development Bank and the Arab Gulf Commercial Bank) for a period of time extending for three years from (2020 to 2022). This study concluded with a group Among the conclusions was the most important. The two banks in the research sample suffer from problems in investment and credit policies in managing their investments, and this is clear through the financial analysis and balances found in the financial statements. The researcher also recommended a set of recommendations, including: the necessity of reconsidering the investment and credit policies of the banks themselves, and the need to focus on using financial analysis indicators in measuring the strengths and weaknesses in all aspects of the bank’s activities, not just profitability