Title: Bank funding and liquidity in an emerging market

Authors: Van Dan Dang

Addresses: Department of Finance, Banking University of Ho Chi Minh City, Ho Chi Minh City 700000, Vietnam

Abstract: The study examines the impact of bank funding, in two main dimensions capturing equity capital and customer deposits, on bank liquidity positions in an emerging market. Through the regression estimates following both dynamic and static approaches in panel data models and the support of typical characteristics in funding structure of Vietnamese banks from 2007 to 2017, the study has the ideal tools to find the research results as expected, based on traditional accounting measures. The results show that equity capital and customer deposits have positive effects on bank liquidity positions. Further, the state ownership factor indicates no difference between liquidity behaviours of surveyed banks. These results are validated by alternative robustness checks from both linear and nonlinear specifications. The findings clarify the debates relating to emerging economies, thus providing some implications for better disciplines.

Keywords: deposit; emerging market; equity; funding liquidity; funding structure; market liquidity.

DOI: 10.1504/IJEPEE.2020.109054

International Journal of Economic Policy in Emerging Economies, 2020 Vol.13 No.3, pp.256 - 272

Received: 07 Jul 2019
Accepted: 24 Jan 2020
Published online: 17 Aug 2020 *

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