Determinants of commercial banks' liquidity in the czech republic

Abstract

This paper aims to identify determinants of liquidity of commercial banks in the Czech Republic. We consider bank specific and macroeconomic data over the period from 2001 to 2009 and analyze them with panel data regression analysis. We have found that bank liquidity is positively related to capital adequacy, interest rates on loans, share of non-performing loans and interest rate on interbank transaction and negatively related to inflation rate, business cycle and financial crisis. The influence of banks size is ambiguous.