"CAUSAL ANALYSIS OF THE RELATIONSHIP BETWEEN NET STABLE FUNDING AND BANK INVESTMENT: A STUDY ON A SAMPLE OF IRAQI PRIVATE COMMERCIAL BANKS FOR THE PERIOD (2017–2020)"
DOI:
https://doi.org/10.61841/bzypyb84Keywords:
Net Stable Funding, Bank Investment, Iraqi PrivateAbstract
This study aims to measure the causal relationship between Net Stable Funding, represented by its indicators (Net Stable Funding Ratio, Loans to Total Deposits Ratio, and Cash to Total Deposits Ratio) as explanatory variables, and Bank Investment, represented by its indicators (Bank Investment to Total Deposits Ratio, and Bank Investment to Total Assets Ratio) as dependent variables. The research investigates the direction of this relationship using the Granger Causality test for short-term data and the Toda-Yamamoto causality approach for long-term data. Additionally, the correlation between the research variables is measured using the statistical software EViews 10 The study population consists of Iraqi private commercial banks. A sample of ten private banks listed on the Iraq Stock Exchange was selected due to their financial contribution to the development of the Iraqi banking sector. The research hypothesis was tested using a descriptive-analytical method based on the banks' annual reports for the period from 2017 to 2020.
References
Annual reports of the private commercial banks in the study sample. (2020). Available at the official website of the Iraq Stock Exchange: https://cbi.iq
Arab Monetary Fund. (2019). Report on the implementation of the Net Stable Funding Ratio according to Basel III Agreement. Arab Committee for Banking Supervision.
Basel Committee on Banking Supervision (BCBS). (2015). Basel III: International framework for liquidity risk measurement, standards, and monitoring.
Hans, P. B. (2019). Net stable funding ratio and liquidity hoarding (Master’s thesis). University of Hohenheim, Stuttgart, Germany.
Le, M. H. V. (2019). Net stable funding ratio and profit efficiency of commercial banks in the USA (Master’s thesis). Ton Duc Thang University.
Ali, P. (2021). Innovation and extended responsibility in supply chain management (Master’s thesis). Peking University, Engineering Department.
Bernd, F., & Bill, H. (2016). A RAROC valuation scheme for loans and its application in loan origination. Journal of Financial Economics, 8(63).
Jeanne. (2014). Does the implementation of a net stable funding ratio enhance the financial stability of the banking industry? An international study. Islamic Development Bank Group, Jeddah, University Mohammad Bin Fahd, Saudi Arabia.
Alexander, M. (2013). Regulation of bank proprietary trading post-2007. Journal of International Money and Finance, 35, January 2021.
Dong, B. G. (2021). New accident measuring financial stability. Umm Al-Qura University Journal, 4(3).
Khan, M., & Raj, K. B. (2020). Liquidity, profitability, and prediction of bankruptcy: A study of selected telecom companies. Journal of Critical Reviews, 7(3).
Rehana, K., Zeeshan, M., & Ulfat, A. (2016). Impact of net stable funding ratio regulation on net interest margin: A multi-country comparative analysis. Journal of Accounting and Finance in Emerging Economies, 2(2).
Van, D. D. (2021). The Basel III net stable funding ratio and a risk-return trade-off: Bank-level evidence from Vietnam. Asian Academy of Management Journal of Accounting and Finance (AAMJAF), 17(2).
Rose, P., & Hudgins, S. (2010). Bank management and financial services (8th ed.). McGraw-Hill, USA.
Hamad, M. S. (2019). Requirements for applying the liquidity coverage ratio (LCR) and net stable funding ratio (NSFR) in Islamic banks: A comparative study between an Islamic bank and a commercial bank (Higher Diploma equivalent to Master’s). Higher Institute of Accounting and Financial Studies, University of Baghdad, Iraq.
Bori, H. R., & Abdullah, Y. A. (2022). Assessment of bank liquidity using financial indicators: An analytical study of Middle East Bank for the period 2015–2019. Journal of Administration and Economics, (132), Al-Mustansiriya University, Iraq.
Mohammed, M. J. M. (2021). Bank credit and private investment in Egypt: An empirical study for the period 1991–2019. Journal of Financial and Commercial Research, 22(1), Faculty of Commerce, Sohag University.
Downloads
Published
Issue
Section
License
Copyright (c) 2025 Journal of Advance Research in Business, Management and Accounting (ISSN: 2456-3544)

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
Terms & Condition
Submission -
Author can submit the manuscript through our online submission process or email us at the designated email id in contact details.
The other mode of submission not accepted than online and email.
Before submission please read the submission guidelines.
NN Publication accepts only article submitted in pdf/doc/docx/rtf file format. Another format except given file formats will no be considered .
Author will be responsible for the error mistakes in the submission files. The minor changes can be done without any cost after publication. But for major changes NN Publication may charges you the editing charges.
Publication (Online) -
The online publication is scheduled on last date of every month, but it can be delayed by 24 to 48 hours due to editorial process if huge number of articles comes to publish in single issue.
Automatic notification email will be sent to the all users on publication of an issue, so its author’s duty to check their email inbox or SPAM folder to get this notification.
After publication of article author can not withdraw their article.
If editor’s found any issue after publication of article then the NN Publication have the authority to remove the article from online website.
No refund will be provided after online publication of article.
Publication (Print) -
The print copy publication are sent as per the author’s request after 2 weeks of online publication of that issue.
NN Publication will ship the article by India Post and provide the consignment number on dispatch of print copy.
NN Publication follows all the guidelines of delivery provided by India Post and hence not responsible for delay in delivery due to any kind of reasons.
Refund of hard copy will not be provided after dispatch or print of the journal.
NN Publication will be responsible for raise a complain if there is any issue occurs in delivery, but still will not be responsible for providing the refund.
NN Publication will be responsible to resend the print copy only and only if the print copy is lost or print copy is damaged in delivery / or there is delay more than 6 months.
According to India Post the delivery should be completed with in 1-3 weeks after dispatch of articles.
Privacy Policy-
NN Publication uses the email ids of authors and editors and readers for sending editorial or publication notification only, we do not reveal or sell the email ids to any other website or company.