The influence of liquidity risk on efficiency in rural banks: the moderating role of interbank borrowing fund

IF 0.7 Q4 BUSINESS, FINANCE

Asian Academy of Management Journal of Accounting and Finance Pub Date : 2021-12-10 DOI:10.21315/aamjaf2021.17.2.3

Meliza Zafrizal, Rubayah Yakob, S. Low

{"title":"The influence of liquidity risk on efficiency in rural banks: the moderating role of interbank borrowing fund","authors":"Meliza Zafrizal, Rubayah Yakob, S. Low","doi":"10.21315/aamjaf2021.17.2.3","DOIUrl":null,"url":null,"abstract":"High competition in Indonesian banking sectors has resulted in the non-survival of rural banks in Indonesia in the long run. The lack of third-party funding becomes one of the most important factors that cause many rural banks to face liquidity risk. Hence, many rural banks use interbank borrowing fund as an alternative source of funding in order to meet their liquidity requirement. Moreover, this risk also leads to many rural banks in Indonesia having to deal with low efficiency problem. This research examines not only the influence of liquidity risk on efficiency but also the role of interbank borrowing fund as a moderator variable. Random effect regression analysis reveals that liquidity risk has negative influence on efficiency. Furthermore, as moderator variable, interbank borrowing fund is shown to enhance the influence of liquidity risk on efficiency. This research becomes guidance for rural banks in managing their liquidity risk and efficiency. In addition, this research also can provide direction for authority in setting some regulation regarding to rural banks’ activities in interbank market.","PeriodicalId":44370,"journal":{"name":"Asian Academy of Management Journal of Accounting and Finance","volume":null,"pages":null},"PeriodicalIF":0.7000,"publicationDate":"2021-12-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Asian Academy of Management Journal of Accounting and Finance","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.21315/aamjaf2021.17.2.3","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q4","JCRName":"BUSINESS, FINANCE","Score":null,"Total":0}

引用次数: 0

Abstract

High competition in Indonesian banking sectors has resulted in the non-survival of rural banks in Indonesia in the long run. The lack of third-party funding becomes one of the most important factors that cause many rural banks to face liquidity risk. Hence, many rural banks use interbank borrowing fund as an alternative source of funding in order to meet their liquidity requirement. Moreover, this risk also leads to many rural banks in Indonesia having to deal with low efficiency problem. This research examines not only the influence of liquidity risk on efficiency but also the role of interbank borrowing fund as a moderator variable. Random effect regression analysis reveals that liquidity risk has negative influence on efficiency. Furthermore, as moderator variable, interbank borrowing fund is shown to enhance the influence of liquidity risk on efficiency. This research becomes guidance for rural banks in managing their liquidity risk and efficiency. In addition, this research also can provide direction for authority in setting some regulation regarding to rural banks’ activities in interbank market.

查看原文本刊更多论文

流动性风险对村镇银行效率的影响：同业拆借资金的调节作用

从长远来看，印尼银行业的高度竞争导致印尼农村银行无法生存。缺乏第三方融资成为许多农村银行面临流动性风险的最重要因素之一。因此，许多农村银行将同业拆借资金作为替代资金来源，以满足其流动性需求。此外，这种风险也导致印尼许多农村银行不得不处理低效问题。本研究不仅考察了流动性风险对效率的影响，还考察了银行间借款基金作为调节变量的作用。随机效应回归分析表明，流动性风险对效率有负面影响。此外，同业拆借资金作为调节变量，可以增强流动性风险对效率的影响。本研究对农村银行流动性风险管理和流动性效率管理具有指导意义。此外，本研究还可以为当局制定有关农村银行在银行间市场活动的监管提供指导。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

求助全文

约1分钟内获得全文求助全文

来源期刊

Asian Academy of Management Journal of Accounting and Finance BUSINESS, FINANCE-

CiteScore

1.50

自引率

0.00%

发文量

审稿时长

20 weeks

期刊介绍： To provide a forum for the exchange of ideas and dissemination of empirical findings and analytical research in the specialized areas of accounting and finance with special emphasis on scholarly works with policy implications for countries in the Asia Pacific. The following are some of the topical subject areas relevant to the journal (but are not limited to): Accounting • Financial reporting and accounting standards • Auditing issues • Value based accounting and its relevance • Theory of accounting firm • Environmental auditing • Corporate governance issues • Public sector accounting Finance • Valuation of financial assets • International capital flows • Ownership and agency theory • Stock market behavior • Investment and portfolio management • Islamic banking and finance • Microstructures of financial markets