Interactive relationship between credit risk, liquidity risk and banking efficiency
Vol. 133 No. 5D (2024), Original Article
Vol. 133 No. 5D (2024)

Interactive relationship between credit risk, liquidity risk and banking efficiency

Original Article
https://doi.org/10.26459/hueunijed.v133i5D.7613
Published 2024-12-31
Le Ngoc Quynh Anh
University of Economics, Hue University, 99 Ho Dac Di St., Hue, Vietnam
Vo Thi Kieu Oanh
University of Economics, Hue University, 99 Ho Dac Di St., Hue, Vietnam
Le Thi Phuong Thanh
University of Economics, Hue University, 99 Ho Dac Di St., Hue, Vietnam
PDF (Vietnamese)

Keywords

rủi ro thanh khoản
rủi ro tín dụng
hiệu quả ngân hàng
mô hình phương trình tác động đồng thời cho dữ liệu bảng (SEM) liquidity risk
credit risk
bank efficiency
simultaneous equations model for panel data (SEM)

Abstract

The study proves the interactive relationship between credit risk, liquidity risk, and efficiency in 27 Vietnamese commercial banks in the period from 2018 to 2022, considered through the simultaneous equation model (SEM). The findings provide new empirical evidence on the interplay between liquidity risk and credit risk, as well as between liquidity risk and bank performance. Specifically, the study found a positive relationship between liquidity risk and credit risk, while liquidity risk and profitability were inversely related. However, the interaction between credit risk and bank efficiency has not been conclusively proven. The study highlights the importance of both credit risk and liquidity risk in enhancing the performance of commercial banks in Vietnam. Furthermore, it offers potential solutions for improving credit and liquidity risk management to mitigate risks and boost bank efficiency in the future.

https://doi.org/10.26459/hueunijed.v133i5D.7613
PDF (Vietnamese)

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