DIMENSIONS OF LIQUIDITY AND THEIR FACTORS IN THE SLOVENIAN BANKING SECTOR
The interest in bank liquidity has grown signiﬁcantly in recent times not only among regulators, but in authors’ studies as well. The trigger mechanism was mainly the recent global ﬁnancial crisis, where a number of systems faced liquidity problems. On the basis of the crisis, the regulation on the part of the Basel Committee (Bank for International Settlements, 2010) in the area of liquidity has increased. The Basel Committee proposed the introduction of two liquidity indicators: the LCR (Liquidity Coverage Ratio) and the NSFR (Net Stable Funding Ratio), which the member states must obligatorily fulﬁl based on European law.
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Slovenian banking sector, dimension of liquidity, liquidity determinants, internal factors
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The present article focuses on the internal factors which have potential inﬂ uence on the liquidity of the Slovenian banking sector. Unlike other studies, this paper uses multiple dependent variables…více
The present article focuses on the internal factors which have potential inﬂ uence on the liquidity of the Slovenian banking sector. Unlike other studies, this paper uses multiple dependent variables, encompassing different views on liquidity and leading to higher complexity. These include the creation of liquidity, its outﬂ ow, net change and total reallocation, determined on the basis of a speciﬁc method of liquidity measurement – the gross liquidity ﬂ ows. The chosen independent variables include various items of internal character such as loans, deposits, proﬁt, capital and the size of the bank. Robust regression analyses are performed. The results indicate that internal factors have the greatest inﬂ uence on the creation of liquidity, where almost all the variables considered were signiﬁcant. Used factors do not only affect liquidity creation, often investigated by authors, but affect other dimensions of liquidity as well. A signiﬁcant item which played a role in multiple dimensions of liquidity was the value of loans and the size of the bank (total assets). The models have shown that any given factor only has an inﬂ uence on the creation of liquidity without inﬂ uencing its outﬂ ow and vice versa. Thus, when looking for determinants only for the creation or only for the outﬂ ow of liquidity, the results need not necessarily comprehensively show the inﬂ uence of the given factors, and can lead to erroneous conclusions. It is therefore suitable to include multiple views on the value of liquidity, since the inﬂ uence of a factor can be more dominant in a different dimension of liquidity and affect the ﬁnal value.