The Impacts of Liquidity Creation on Banking Stability: An Empirical Research in ASEAN-5

1 Ahamed, M. M., & Mallick, S. K. (2019). Is financial inclusion good for bank stability? International evidence. Journal of Economic Behavior & Organization, 157, 403-427. doi: https://doi.org/10.1016/j.jebo.2017.07.027 Search in Google Scholar

2 Ali, M., Haroon, O., Rizvi, S. A. R., & Azmi, W. (2021). Stability versus fragility: new evidence from 84 banks. Studies in Economics and Finance, 38(2), 441-453. doi: https://doi.org/10.1108/SEF-04-2020-0109 Search in Google Scholar

3 Allen, F., & Gale, D. (2004). Financial fragility, liquidity, and asset prices. Journal of the European Economic Association, 2(6), 1015-1048. doi: https://doi.org/10.1162/JEEA.2004.2.6.1015 Search in Google Scholar

4 Banna, H., & Alam, M. R. (2021). Impact of digital financial inclusion on ASEAN banking stability: implications for the post-Covid-19 era. Studies in Economics and Finance, 38(2), 504-523. doi: https://doi.org/10.1108/SEF-09-2020-0388 Search in Google Scholar

5 Berger, A. N., Boubakri, N., Guedhami, O., & Li, X. (2019). Liquidity creation performance and financial stability consequences of Islamic banking: Evidence from a multinational study. Journal of Financial Stability, 44, 100692. doi: https://doi.org/10.1016/j.jfs.2019.100692 Search in Google Scholar

6 Berger, A. N., & Bouwman, C. H. (2009). Bank liquidity creation. The review of financial studies, 22(9), 3779-3837. doi: https://doi.org/10.1093/rfs/hhn104 Search in Google Scholar

7 Berger, A. N., & Bouwman, C. H. (2017). Bank liquidity creation, monetary policy, and financial crises. Journal of Financial Stability, 30, 139-155. doi: https://doi.org/10.1016/j.jfs.2017.05.001 Search in Google Scholar

8 Berger, A. N., & Bouwman, C. H. S. (2009). Bank Liquidity Creation. Review of Financial Studies, 22(9), 3779-3837. doi:10.1093/rfs/hhn104 Search in Google Scholar

9 Berglund, T., & Mäkinen, M. (2019). Do banks learn from financial crisis? The experience of Nordic banks. Research in International Business and Finance, 47, 428-440. doi: https://doi.org/10.1016/j.ribaf.2018.09.004 Search in Google Scholar

10 Block, J. H., Miller, D., & Wagner, D. (2014). Bayesian methods in family business research. Journal of Family Business Strategy, 5(1), 97-104. doi: https://doi.org/10.1016/j.jfbs.2013.12.003 Search in Google Scholar

11 Brief, A. P. (2020). Economic impact of COVID-19 outbreak on ASEAN. ASEAN Integration Monitoring Directorate (AIMD) and Community Relations Division (CRD), 1-17. Search in Google Scholar

12 Bryant, J. (1980). A model of reserves, bank runs, and deposit insurance. Journal of banking & finance, 4(4), 335-344. doi: https://doi.org/10.1016/0378-4266(80)90012-6 Search in Google Scholar

13 Dang, V. D. (2022). Bank funding, market power, and the bank liquidity creation channel of monetary policy. Research in International Business and Finance, 59, 101531. doi: https://doi.org/10.1016/j.ribaf.2021.101531 Search in Google Scholar

14 Doğan, M., & Yildiz, F. (2023). Testing the factors that determine the profitability of banks with a dynamic approach: evidence from Turkey. Journal of Central Banking Theory and Practice, 12(1), 225-248. DOI: 10.2478/jcbtp-2023-0010 Search in Google Scholar

15 Diamond, D. W. (1996). Liquidity, banks, and markets: effects of financial development on banks and the maturity of financial claims (Vol. 1566): World Bank Publications. Search in Google Scholar

16 Diamond, D. W., & Rajan, R. G. (2005). Liquidity shortages and banking crises. The Journal of finance, 60(2), 615-647. doi: https://doi.org/10.1111/j.1540-6261.2005.00741.x Search in Google Scholar

17 Distinguin, I., Roulet, C., & Tarazi, A. (2013). Bank regulatory capital and liquidity: Evidence from US and European publicly traded banks. Journal of banking & finance, 37(9), 3295-3317. doi: https://doi.org/10.1016/j.jbankfin.2013.04.027 Search in Google Scholar

18 Duan, Y., & Niu, J. (2020). Liquidity creation and bank profitability. The North American Journal of Economics and Finance, 54, 101250. doi: https://doi.org/10.1016/j.najef.2020.101250 Search in Google Scholar

19 Fidrmuc, J., Fungáčová, Z., & Weill, L. (2015). Does bank liquidity creation contribute to economic growth? Evidence from Russia. Open Economies Review, 26, 479-496. doi: https://doi.org/10.1007/s11079-015-9352-1 Search in Google Scholar

20 Fiordelisi, F., & Mare, D. S. (2014). Competition and financial stability in European cooperative banks. Journal of International Money and Finance, 45, 1-16. doi: https://doi.org/10.1016/j.jimonfin.2014.02.008 Search in Google Scholar

21 Fu, X., Lin, Y., & Molyneux, P. (2016). Bank capital and liquidity creation in Asia Pacific. Economic Inquiry, 54(2), 966-993. doi: https://doi.org/10.1111/ecin.12308 Search in Google Scholar

22 Fungacova, Z., Turk, R., & Weill, L. (2021). High liquidity creation and bank failures. Journal of Financial Stability, 57, 100937. doi:10.1016/j.jfs.2021.100937. Search in Google Scholar

23 Gelfand, A. E., Hills, S. E., Racine-Poon, A., & Smith, A. F. (1990). Illustration of Bayesian inference in normal data models using Gibbs sampling. Journal of the American Statistical Association, 85(412), 972-985. doi: https://doi.org/10.1080/01621459.1990.10474968 Search in Google Scholar

24 Grzegorczyk, M. (2023). Being Bayesian about learning Gaussian Bayesian networks from incomplete data. International Journal of Approximate Reasoning, 108954. doi: https://doi.org/10.1016/j.ijar.2023.108954 Search in Google Scholar

25 Gupta, J., & Kashiramka, S. (2020). Financial stability of banks in India: does liquidity creation matter? Pacific-Basin Finance Journal, 64, 101439. doi: https://doi.org/10.1016/j.pacfin.2020.101439 Search in Google Scholar

26 Gupta, J., & Kashiramka, S. (2024). Examining the impact of liquidity creation on bank stability in the Asia Pacific region: Do ESG disclosures play a moderating role? Journal of International Financial Markets, Institutions and Money, 91, 101955. doi: https://doi.org/10.1016/j.intfin.2024.101955 Search in Google Scholar

27 Ha, V. D., Nguyen, T. X. L., Ta, T. H. N., & Nguyen, M. H. (2021). Does Capital Affect Bank Risk in Vietnam: A Bayesian Approach. Data Science for Financial Econometrics, 898, 623-633. doi: https://doi.org/10.1007/978-3-030-48853-6_42 Search in Google Scholar

28 Hasanul Banna, M. R. A. (2021). Impact of digital financial inclusion on ASEAN banking stability: implications for the post-Covid-19 era. Studies in Economics and Finance, 38(2), 504-523. doi: https://doi.org/10.1108/SEF-09-2020-0388 Search in Google Scholar

29 Javid, M., Chandia, K. E., Zaman, Q. U., & Akhter, W. (2023). Examining the effect of liquidity creation on banking profitability and stability: moderating role of political instability. Kybernetes, 52(10), 4061-4080. doi: https://doi.org/10.1108/K-01-2022-0021 Search in Google Scholar

30 Jiang, L., Levine, R., & Lin, C. (2019). Competition and bank liquidity creation. Journal of Financial and Quantitative Analysis, 54(2), 513-538. doi: https://doi.org/10.1017/S0022109018000820 Search in Google Scholar

31 Kennedy, P. (2008). A guide to econometrics: John Wiley & Sons. Search in Google Scholar

32 Kruschke, J. K., Liddell, T.M. . (2018). Bayesian data analysis for newcomers. Psychonomic bulletin & review,, 25(1), 155–177. doi: https://doi.org/10.3758/s13423-017-1272-1 Search in Google Scholar

33 Lepetit, L., & Strobel, F. (2013). Bank insolvency risk and time-varying Z-score measures. Journal of International Financial Markets, Institutions & Money, 25, 73–87. doi: https://doi.org/10.1016/j.intfin.2013.01.004 Search in Google Scholar

34 Lestari, D., Ma, S., & Jun, A. (2023). Enhancing bank stability from diversification and digitalization perspective in ASEAN. Studies in Economics and Finance. doi: https://doi.org/10.1108/SEF-12-2022-0554 Search in Google Scholar

35 Miočević, M., MacKinnon, D. P., & Levy, R. (2017). Power in Bayesian mediation analysis for small sample research. Structural equation modeling: a multidisciplinary journal, 24(5), 666-683. doi: https://doi.org/10.1080/10705511.2017.1312407 Search in Google Scholar

36 Neter, J., Kutner, M. H., Nachtsheim, C. J., & Wasserman, W. (1996). Applied linear statistical models. Search in Google Scholar

37 Nguyen, H. T., Trung, N. D., & Thach, N. N. (2019). Beyond traditional probabilistic methods in econometrics. Paper presented at the Beyond Traditional Probabilistic Methods in Economics 2. Search in Google Scholar

38 Nguyen, T. V. H., Ahmed, S., Chevapatrakul, T., & Onali, E. (2020). Do stress tests affect bank liquidity creation? Journal of Corporate Finance, 64, 101622. doi: https://doi.org/10.1016/j.jcorpfin.2020.101622 Search in Google Scholar

39 Mohammad, K. U., & Khan, M. R. (2024). Liquid asset holdings and banking profitability: Evidence from South Asia. Journal of Central Banking Theory and Practice, 13(2), 129-152. DOI: 10.2478/jcbtp-2024-0016 Search in Google Scholar

40 Mdaghri, A. A., & Oubdi, L. (2022). Bank-specific and macroeconomic determinants of bank liquidity creation: Evidence from MENA countries. Journal of Central Banking Theory and Practice, 11(2), 55-76. DOI: 10.2478/jcbtp-2022-0013 Search in Google Scholar

41 Oanh, T. T. K., Van Nguyen, D., Le, H. V., & Duong, K. D. (2023). How capital structure and bank liquidity affect bank performance: Evidence from the Bayesian approach. Cogent Economics & Finance, 11(2), 2260243. doi: https://doi.org/10.1080/23322039.2023.2260243 Search in Google Scholar

42 Qureshi, S., & Aftab, M. (2023). Exchange rate interdependence in ASEAN markets: A wavelet analysis. Global Business Review, 24(6), 1180-1204. doi: https://doi.org/10.1177/0972150920919371 Search in Google Scholar

43 Rashid, A., & Naeem, N. (2017). Effects of mergers on corporate performance: An empirical evaluation using OLS and the empirical Bayesian methods. Borsa Istanbul Review, 17(1), 10-24. doi: https://doi.org/10.1016/j.bir.2016.09.004 Search in Google Scholar

44 Sahyouni, A., & Wang, M. (2018). The determinants of bank profitability: does liquidity creation matter? Journal of Economics and Financial Analysis, 2(2), 61-85. doi:10.1991/jefa.v2i2.a18 Search in Google Scholar

45 Sahyouni, A., Zaid, M.A.A. and Adib, M. (2021). Bank soundness and liquidity creation. EuroMed Journal of Business, 16(1), 86-107 doi: https://doi.org/10.1108/EMJB-04-2019-0061 Search in Google Scholar

46 Samarasinghe, A. (2023). Stock market liquidity and bank stability. Pacific-Basin Finance Journal, 79, 102028. doi: https://doi.org/10.1016/j.pacfin.2023.102028 Search in Google Scholar

47 Shabir, M., Jiang, P., Bakhsh, S., & Zhao, Z. (2021). Economic policy uncertainty and bank stability: Threshold effect of institutional quality and competition. Pacific-Basin Finance Journal, 68(101610). doi: https://doi.org/10.1016/j.pacfin.2021.101610 Search in Google Scholar

48 Smid, S. C., McNeish, D., Miočević, M., & van de Schoot, R. (2020). Bayesian versus frequentist estimation for structural equation models in small sample contexts: A systematic review. Structural equation modeling: a multidisciplinary journal, 27(1), 131-161. doi: https://doi.org/10.1080/10705511.2019.1577140 Search in Google Scholar

49 Thach, N. N. (2020). How to explain when the ES is lower than one? A Bayesian nonlinear mixed-effects approach. Journal of Risk and Financial Management, 13(2), 21. doi: https://doi.org/10.3390/jrfm13020021 Search in Google Scholar

50 Toh, M. Y. (2019). Effects of bank capital on liquidity creation and business diversification: Evidence from Malaysia. Journal of Asian Economics, 61, 1-19. doi: https://doi.org/10.1016/j.asieco.2018.12.001 Search in Google Scholar

51 Tran, V. T., Lin, C.-T., & Nguyen, H. (2016). Liquidity creation, regulatory capital, and bank profitability. International Review of Financial Analysis, 48, 98-109. doi: https://doi.org/10.1016/j.irfa.2016.09.010 Search in Google Scholar

52 Thanh Nga, T. T. (2025). Fintech innovation and banking stability: evidence from a developing country approach by quantile regression. Ianna Journal of Interdisciplinary Studies. Vol 7 (2) 789-803, DOI: https://doi.org/10.5281/zenodo.15599960 Search in Google Scholar

53 Windmeijer, F. (2005). A finite sample correction for the variance of linear efficient two-step GMM estimators. Journal of econometrics, 126(1), 25-51. Search in Google Scholar

54 Williams, B., & Rajaguru, G. (2022). The evolution of bank revenue and risk in the Asia-Pacific Region. Pacific-Basin Finance Journal, 71, 101693. doi: https://doi.org/10.1016/j.pacfin.2021.101693. Search in Google Scholar

55 Yeddou, N., & Pourroy, M. (2020). Bank liquidity creation: does ownership structure matter? The Quarterly Review of Economics and Finance, 78, 116-131. doi: https://doi.org/10.1016/j.qref.2020.01.003 Search in Google Scholar

56 Zhang, X., Fu, Q., Lu, L., Wang, Q., & Zhang, S. (2021). Bank liquidity creation, network contagion and systemic risk: Evidence from Chinese listed banks. Journal of Financial Stability, 53, 100844. doi: https://doi.org/10.1108/EMJB-04-2019-0061 Search in Google Scholar

57 Zheng, C., & Cronje, T. (2019). The moderating role of capital on the relationship between bank liquidity creation and failure risk. Journal of banking & finance, 108, 105651. doi: https://doi.org/10.1016/j.jbankfin.2019.105651 Search in Google Scholar