Journal Screenshot

International Journal of Academic Research in Accounting, Finance and Management Sciences

Open Access Journal

ISSN: 2225-8329

Capital Adequacy of the Jordanian Banking Sector for the Period 2000-2013

Torki M. AL- Fawwaz, Ghazi A. Alrgaibat

http://dx.doi.org/10.6007/IJARAFMS/v5-i1/1555

Open access

The study seeks to identify the capital adequacy of the Jordanian banking system for the period 2000-2013. The researcher adopted the descriptive and the analytical approaches to identify the capital adequacy of the Jordanian banking system depending on data obtained from the Amman Stock Exchange Market, the Central Bank of Jordan and the Jordanian Ministry of Finance for the period 2000 - 2013. The study showed that there is a statistically significant relationship between the capital adequacy and liquidity. There is a statistically significant relationship between capital adequacy and credit risk. There is a statistically significant relationship between capital adequacy and the capital risk. There is a statistically significant relationship between capital adequacy and investments in the securities portfolio. The researcher recommends the commercial banks to increase their strategic planning and management capacity to utilize any rise in capital to increase profits. They should develop market and operational risk assessment methods to be included in the calculation of capital adequacy ratio of the commercial banks. Further studies should be conducted on the capital the adequacy of the Jordanian commercial banks.

Al_Sairafi, M. A. F. (2006): Banking Management, Dar El-Manahij for Publication and Distribution, Amman, Jordan.
Al-Sheikh, H. M. (2005): Measuring the Solvency of Islamic Banks in the Framework of the New Standard for Capital adequacy, the third World Conference on Islamic Economics, Umm Al Qura University, Saudi Arabia.
Al-Zubi, K., Al-Abadi, M., & Afaneh, H. (2008), Jordan Journal of Business Administration, Volume 4, No. 1, http://dar.ju.edu.jo/DAR/JJBA/index.htm.
Barakat, A. (2009), BANKS BASEL II NORMS REQUIREMENT REGARDING INTERNAL CONTROL FIELD STUDY ON JORDAN BANKS, Delhi Business Review, Vol. 10, No. 2, pp.35-48
Basel Committee. (2000): Principles for the Management of Credit Risk, Sep. p5. www.bis.com.
Cai, Z., and Wheale, P. (2007), The new capital accord and the Chinese banking industry, Journal of Banking Regulation , vol. 8, 3, pp. 262-289.
Hoose, D. V. (2010): The Industrial Organization of Banking, Springer. Hennie Van Greuning, Sonja Brajovic Bratanovic(2009): Analyzing Banking Risk, Third Edition, The international Bank for Reconstruction and Development, Washington.
Gholami, H. (2010): The Impact of Appling Basel Capital Adequacy Requirements on Banks, "A case study of Jordanian commercial banks' performance. Yarmouk University, Irbid, Jordan.
Jose, M. B., Amiyatosh, P., & Uday, R (2008), Corporate Hedging, Investment and Value, Working Paper, http://www.federalreserve.gov/pubs/feds/2008/Pp 1-43.
Karun, A. (2013): the Extent of Banks' Commitment to Implement the Algerian Capital Adequacy according to The Recommendations of Basel Committee, Master Thesis, Ferhat Abbas University, Algeria.
Melegy, H. (2002), Development of Accounting Measure to Judge the capital adequacy of the commercial banks: An Empirical Study, the Scientific journal of the Faculty of Commerce, No. 26, pp. 329-412.
Mikhlafi, A. A. (2004), Bank Capital Adequacy According to the International Standards. Analysis of a case study of the Yemeni banks, Ph.D., National Information Center, Yemen, www.yemen-nic.info.
Obeidat, Samer, Fakhri. (2008): Determinants of Capital Adequacy in the Jordanian Commercial Banks, an Empirical Study. Balqa Applied University, Jordan.
Shahatit, M. I. T., Saud, M. (2011): The Standard Analysis of the Application of Capital Adequacy on the Profitability of Commercial Banks, The Journal of Administrative Sciences, Volume 38, Issue 2, Amman, Jordan.

In-Text Citation: (AL-Fawwaz & Alrgaibat, 2015)
To Cite this Article: AL-Fawwaz, T. M., & Alrgaibat, G. A. (2015). Capital Adequacy of the Jordanian Banking Sector for the Period 2000-2013. International Journal of Academic Research in Accounting Finance and Management Sciences, 5(1), 239–253.