Liquidity Determinants of Moroccan Banking Industry

This paper analyzes the behavior of Moroccan bank’s liquidity during the period 2001 – 2012. The research aims to identify the determinants of Moroccan bank’s liquidity. We first evaluate Moroccan banks’ liquidity positions through different liquidity ratios to determine the effects of financial crisis on bank’s liquidity. We then highlight the effect of banks’ size on banks’ liquidity. Finally, we identify determinants of Moroccan bank’s liquidity using panel data regression. From results obtained, we can conclude that liquidity has decreased during the last decade. This decline has increased since 2007 with the financial crisis. We also conclude that banks’ size is a determinant of banks’ liquidity since liquidity is correlated with size of banks. Large banks are more liquid than small banks. Results show that in Morocco, liquidity is mainly determined by eleven 11 determinants: size of banks, share of own bank’s capital of the bank's total assets, external funding to total liabilities, return on assets, foreign direct investment, monetary aggregate M3, foreign assets, growth rate of gross domestic product, public deficit, inflation ratio and the effects of financial crisis. Thus, liquidity of Moroccan banking industry is positively correlated with bank’s size, share of own bank’s capital of the bank's total assets, external funding to total liabilities, monetary aggregate M3, foreign assets, foreign direct investment and negatively correlated with return on assets, inflation rate, growth rate of gross domestic product, public deficit and financial crisis. However, bank’s return on equity, equity to total assets and unemployment rate have no impact on Moroccan bank’s liquidity

Liquidity risk and contagion in interbank markets: a presentation of Allen and Gale Model

The paper analyzes liquidity risk and contagion in interbank markets. The aim of the research is to define the different structures of interbank markets and structures that allow the better allocation of liquidity and thus avoid the spread of crisis in the whole system. For this purpose, this paper examines Allen and Gale model. This model is the pioneer model in the management of liquidity risk in the interbank market. We will then analyze the mechanisms that explain the spread of liquidity risk in the banking system both at national and international level

Liquidity Determinants of Moroccan Banking Industry

This paper analyzes the behavior of Moroccan bank’s liquidity during the period 2001 – 2012. The research aims to identify the determinants of Moroccan bank’s liquidity. We first evaluate Moroccan banks’ liquidity positions through different liquidity ratios to determine the effects of financial crisis on bank’s liquidity. We then highlight the effect of banks’ size on banks’ liquidity. Finally, we identify determinants of Moroccan bank’s liquidity using panel data regression. From results obtained, we can conclude that liquidity has decreased during the last decade. This decline has increased since 2007 with the financial crisis. We also conclude that banks’ size is a determinant of banks’ liquidity since liquidity is correlated with size of banks. Large banks are more liquid than small banks. Results show that in Morocco, liquidity is mainly determined by eleven 11 determinants: size of banks, share of own bank’s capital of the bank's total assets, external funding to total liabilities, return on assets, foreign direct investment, monetary aggregate M3, foreign assets, growth rate of gross domestic product, public deficit, inflation ratio and the effects of financial crisis. Thus, liquidity of Moroccan banking industry is positively correlated with bank’s size, share of own bank’s capital of the bank's total assets, external funding to total liabilities, monetary aggregate M3, foreign assets, foreign direct investment and negatively correlated with return on assets, inflation rate, growth rate of gross domestic product, public deficit and financial crisis. However, bank’s return on equity, equity to total assets and unemployment rate have no impact on Moroccan bank’s liquidity

Liquidity risk and contagion in interbank markets: a presentation of Allen and Gale Model

The paper analyzes liquidity risk and contagion in interbank markets. The aim of the research is to define the different structures of interbank markets and structures that allow the better allocation of liquidity and thus avoid the spread of crisis in the whole system. For this purpose, this paper examines Allen and Gale model. This model is the pioneer model in the management of liquidity risk in the interbank market. We will then analyze the mechanisms that explain the spread of liquidity risk in the banking system both at national and international level

Savings Determinants of Moroccan banks: A cointegration modeling approach

The present paper examines the existence or not of long run relationship between bank-specific and macroeconomic variables and savings in Moroccan banks using cointegration approach and aims to identify the determinants of Moroccan banks’ savings. We first use Augmented Dickey Fuller (DICKEY and FULLER, 1979) test and PHILLIPS-PERON (PP) unit root test to test the stationary. As all the variables are integrated of the order 1, we apply JOHANSEN JUSELIUS cointegration test to test the cointagration and to evaluate the existence of long-run relationship between the variables. The presence of cointegration between deposits and others variables provide evidence that these variables share a long-run relationship. Therefore, it concludes that there is a long run equilibrium governing the relationship among the variables

Savings Determinants of Moroccan banks: A cointegration modeling approach

The present paper examines the existence or not of long run relationship between bank-specific and macroeconomic variables and savings in Moroccan banks using cointegration approach and aims to identify the determinants of Moroccan banks’ savings. We first use Augmented Dickey Fuller (DICKEY and FULLER, 1979) test and PHILLIPS-PERON (PP) unit root test to test the stationary. As all the variables are integrated of the order 1, we apply JOHANSEN JUSELIUS cointegration test to test the cointagration and to evaluate the existence of long-run relationship between the variables. The presence of cointegration between deposits and others variables provide evidence that these variables share a long-run relationship. Therefore, it concludes that there is a long run equilibrium governing the relationship among the variables