Commerce and Management

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Subject: search.filters.subject.Capital adequacy

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    Impact of Global Financial Crisis on Banking Sector Performance in Sri Lanka
    (Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2016) Priyadarshani, K.M.C.; Thilakarathne, P.M.C.
    Financial crisis is a situation in which the supply of money is outpaced by the demand for money. This means liquidity is quickly evaporated because available money is withdrawn from banks. The purpose of this study is to investigate impacts of global financial crisis on banking sector performance in Sri Lanka. It is based on the two objectives which were to assess relationship between financial crisis and bank performance and to examine impacts of Capital Adequacy, Assets Quality, Management Quality, Earnings and Liquidity on bank performance. Data was collected through the annual reports of selected commercial banks from 2007 to 2015.A descriptive statistics, correlation analysis and multiple regression analysis were used to investigate relationship between Capital Adequacy Ratio, Gross Non Performing Advances Ratio, Interest Coverage Ratio, Return on Equity and Liquid Assets Ratio with the Bank performance. The findings indicate that Capital Adequacy Ratio, Gross Non Performing Advances Ratio, Interest Coverage Ratio, Return on Equity had a significant relationship with bank performance. But Liquid Assets Ratio had a no significant relationship with bank performance. Thus the study concludes that global financial crisis significantly influenced on the bank performance. Final outcome of this research is adding knowledge to bank entities to get an idea about how they can preserve their performance within crisis period.
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    Impact of Competitive Ability on Financial Performance of Sri Lankan Banks
    (Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2016) Maduranga, B.I.C.; Aruppala, W.D.N.
    This research analyses the impact of competitive ability on financial performance of listed banks in Sri Lanka. Capital delivers a buffer against losses and thus it ensures safety and soundness of the financial institutions. It is initial requirement for any financial institution to maintain sufficient capital. Liquidity is a main concept that most of investors are not properly maintained and result of that financial plans could be fail to come through such critical time. Liquidity causes more financial issues than rest of factors. The study relied on secondary data and thus annual reports of the listed banks were used to acquiring data. Ratios were used to analyze the data and regression analysis was used to measure relationship of the variables. The main finding in the study is that capital adequacy and liquidity has contributes positively & negatively on financial performance of listed banks in Sri Lanka. The findings of this study is useful for make productive decisions on investing in Sri Lankan banks.
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    FINANCIAL PRACTICES AND EFFICIENCY OF COOPERATIVE RURAL BANKS IN SRI LANKA
    (2010) Jayamaha, A.; Mula, J.M.
    Many small financial institutions (SFIs) in developing countries make great effort to provide efficient services to the poorhouse holders. It is generally accepted that maintaining the financial strength which is importance in corporate governance mechanism of institutions, has a close relationship with the efficiency of financial institutions, although they are small. However, there is a doubt of efficiency of SFIs in developing countries due to not maintaining appropriate financial practices. In Sri Lanka, recent collapses of many financial institutions also signal that they do not maintain sound financial practices. Cooperative rural banks in Sri Lanka (CRBs) one of the formal SFIs in Sri Lanka which serve a large number of customers, deal with a large amount of funds and have substantial contributions to the rural financial sector during the last four decades. This paper seeks to test financial strength of cooperative rural banks in Sri Lanka (CRBs) and whether these strengths have a significant impact on efficiency of these institutions. The financial strength of CRBs was assessed using ratios of capital adequacy, liquidity, asset quality, loan to deposit, profitability, loan portfolio yield, operational efficiency, and operational self-sufficiency. The efficiency of CRBs in Sri Lanka was examined by using Data Envelopment Analysis (DEA), a non-parametric analytic technique. Based on the data extracted from CRBs? financial statements, correlation coefficients showed that several financial practices have significant associations with the efficiency of CRBs in Sri Lanka. This confirms that efficient SFIs maintain sound financial practices which contribute to higher levels of efficiency.