Factors Influencing the Effectiveness of Liquidity Risk Management in Iraqi Banks
Keywords:
risk management, liquidity, monetary policyAbstract
Banks play a vital role in creating liquidity and transforming risk in the economic operations of every country, both at the micro and macro levels. Commercial banks use relatively liquid liabilities to finance relatively illiquid assets, thereby releasing their individual liquidity to maintain the normal functioning of the financial system and promote economic development. Accordingly, the present study aims to identify the factors influencing the effectiveness of liquidity risk management in Iraqi banks. Relying on domain knowledge analysis and the qualitative content analysis model, the factors influencing the effectiveness of liquidity risk management in Iraqi banks were identified. Then, through a persuasive Delphi survey, 17 experts in the field of risk management were selected using a non-random method, and the most effective indicators for measuring the variables were evaluated and refined using the fuzzy network analysis model. Based on the final analyses, the effectiveness of risk management encompasses ten influential factors: organizational literacy, alignment and adaptability, competitive pressure, complexity, government support, managerial capabilities, market uncertainty, relative advantage, technical competencies, and stakeholder engagement. The measurement components for each of these factors were identified and refined. This study identified the factors affecting the effectiveness of liquidity risk management in Iraqi banks and subsequently proposed an effective model for measuring technical components.
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Copyright (c) 2025 Ahamad Jabbar Mahammad (Author); Mahdi Madanchi Zaj (Corresponding author); Gholamreza Zomorodian, Hamidreza Kordlouie (Author)
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
