Measuring the impact of financial liberalization on some indicators of banking stability in the Iraqi economy for the period (2004-2019)

Abstract

The aim of the research is to determine the impact of financial liberalization on the indicators of banking stability in the Iraqi economy. The results of the research showed the existence of a relationship between the interest rate margin index and the banking stability indicators. A direct relationship appeared between the average interest rate margin index and each of (capital adequacy, asset quality and profitability), and therefore The effect of this indicator of banking stability was positive in both capital adequacy and profitability, and negatively in the quality of assets

As for the relationship between the private sector credit ratio to GDP and banking stability indicators, a direct relationship appeared between the private sector credit ratio to GDP and both capital adequacy, asset quality and profitability, and therefore the impact of this indicator on banking stability was positive in both the adequacy of Capital and profitability are negative in asset quality.

The relationship between the mandatory reserve ratio to the total deposits subject to the reserve and the indicators of banking stability also emerged. An inverse relationship was recorded between the indicator of the mandatory reserve ratio to the total deposits subject to the reserve capital adequacy, and a direct relationship with the quality of assets and profitability, and therefore the impact of this indicator on banking stability was negative In terms of capital adequacy, asset quality and profitability.