Date of Publication
6-25-2022
Document Type
Bachelor's Thesis
Degree Name
Bachelor of Science in Management of Financial Institutions
Subject Categories
Finance and Financial Management
College
Ramon V. Del Rosario College of Business
Department/Unit
Financial Management Department
Thesis Advisor
Robert B. Ramos
Defense Panel Chair
Benedict Bismark
Defense Panel Member
Kenneth Yumang
Rene Cuartero
Abstract/Summary
Financial institutions have an important role in a country’s economy since financial institutions contribute to economic growth with various factors such as profit. However, banks encounter several risks compared to other industries. Banks are always concerned with two major factors which are liquidity and solvency in order to avoid any bank failures or crises. This research then aims to analyze the effect of credit and liquidity risk management practices on the profitability ratios of 7 selected thrift banks in the Philippines from 2016 to 2020. Regression analysis was used to analyze the effect and relationship of the risk management practices on profitability ratios. For this research, six different statistical tests were used to prove the hypotheses presented in this study, mainly Pearson Correlation Coefficient and T-Test. Using these different statistical tests and ratios, the study was able to find that Capital Adequacy Ratio (credit risk) and Cash-to-Deposit Ratio have a significant impact and Capital Adequacy Ratio (credit risk) and Loan-to-Deposit Ratio have a significant relationship with profitability. In contrast, Non-performing Loans and Loan-to-Deposit Ratios have an insignificant impact and Non-performing Loans and Cash-to-Deposit Ratios have an insignificant relationship with profitability. This proves that credit risk management and liquidity risk management practices are important factors in determining a bank's profitability and avoiding bank failure.
Abstract Format
html
Language
English
Format
Electronic
Keywords
Financial risk management; Bank liquidity; Bank loans
Recommended Citation
Canlas, R. S., Coronado, J. E., Gianan, J. S., & Hu, S. C. (2022). The effect of credit and liquidity risk management practices on the profitability ratios of selected Philippine thrift banks. Retrieved from https://animorepository.dlsu.edu.ph/etdb_finman/25
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Embargo Period
6-28-2022
