Impak Kecekapan Kos terhadap Risiko Kecairan dalam Institusi Perbankan di Malaysia

Translated title of the contribution: The impact of efficiency on liquidity risk in Malaysian banking institutions

Research output: Contribution to journalArticle

3 Citations (Scopus)

Abstract

This study analyzes the relationship between bank efficiency and liquidity risks of 16 Islamic banks and 27 conventional banks in Malaysia for the period covering year 1994-2014. Bank efficiency is based on cost efficiency, while liquidity risk is measured based on the guidelines of Basel III using Liquidity Coverage Ratio (LCR), which is short term (30 days) and Net Stable Funding Ratio (NSFR), which is long term (one year) in nature. This analysis involves two phases: 1) the cost efficiency scores is estimated using Stochastic Frontier Analysis (SFA) and 2) the relationship between the estimated cost efficiency and liquidity risk is tested using static panel regression method. The results show that cost efficiency of both banking systems have no significant relationship with LCR, but significant negative relationships with NSFR for both Islamic and conventional banks. This means that the higher the cost inefficiency, the lower is the liquidity, and the higher the liquidity risk in long term. In short, cost saving can reduce bank liquidity risk in long-term. Hence, bank cost efficiency must be taken into account by policymakers in formulating liquidity risk management to ensure sustainability of the banking system in Malaysia.

Original languageMalay
JournalJurnal Pengurusan
Volume47
Publication statusPublished - 1 Sep 2016

Fingerprint

Banking
Liquidity risk
Liquidity
Banking system
Bank efficiency
Funding
Malaysia
Panel regression
Islamic financial institutions
Politicians
Regression method
Stochastic frontier analysis
Sustainability
Basel
Cost inefficiency
Cost savings
Risk management

ASJC Scopus subject areas

  • Business and International Management
  • Accounting
  • Business, Management and Accounting (miscellaneous)

Cite this

Impak Kecekapan Kos terhadap Risiko Kecairan dalam Institusi Perbankan di Malaysia. / Khalib, Muniroh; Abdul Rahman, Aisyah; Janor, Hawati.

In: Jurnal Pengurusan, Vol. 47, 01.09.2016.

Research output: Contribution to journalArticle

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