Studying the impact of the banking risks at the financial position of private banks in Syria using panel data

Abstract

Banks play a vital role in supporting and developing the national economy as one of the important investment tools used to raise economic efficiency and raise economic growth rates. These banks are exposed to many risks. Some risks are structural and cannot be separated from the bank’s function. As long as its function is to grant credit (such as loans), credit risks will continue to exist, as long as the financing structure depends on short-term funding sources (current deposits, for example) and the bank’s medium- and long-term investments (long-term loans, for example), liquidity risks will remain high. The importance of the research is evident by identifying the most important risks facing banks as they play avital role in supporting and developing the national economy, as these risks affect the bank’s performance, financial position, profitability, and the safety of depositors funds. In addition to finding a model to measure those risks during the studied period, and the research aims to identify banking risks (credit risks, liquidity risks, interest rate risks) and build a standard model to measure these risks, in addition to explaining the impact of banking risks on the financial position of studied banks during the period from 2014 – 2022, where the financial position was measured by the rate of return on assets, and we relied on standard models using panel data to study this effect.
The study showed that there is no significant impact of interest rate risks and credit risks on the financial position of the studied banks, while it was found that liquidity risks effect on the financial position directly and significantly, as an increase in liquidity risks by one unit will lead to increase in the rate of return on assets by 0.387667.