Empirical Study Of Liquidity Risk Indicators In Indian Private Banks

Abstract

The Indian private banking ability to maintain a robust liquidity position is vital to the economy's seamless user experience. Liquidity risk is caused if a bank fails to fulfill its liquidity, which increases the likelihood of default (PD) in the financial sector. In truth, the lack of liquidity in the Indian banking industry was the major cause of all negative events during the current recession. As a corollary, it's essential to examine the factors that influence bank liquidity. The present research is an attempt by the researcher to study the generic and specific characteristics affecting bank liquidity, with the target population being the Indian Private Banks, from March 2006 to March 2021. The OLS Panel Data Regression Model is used to examine the impact of various bank specific factors on the banks' liquidity risks.