Publication Details
Abstract
This research investigates the internal determinants influencing liquidity risk in commercial banks, employing a Structural Vector Autoregression (SVAR) approach using monthly data from JSCB Xalqbank for the period 2019–2025. The study identifies key internal variables interest rate spreads between loans and deposits for individuals and legal entities (in both national and foreign currencies), the ratio of bank capital to assets, and the relationship between loan and deposit portfolios as principal factors affecting liquidity. The empirical analysis confirms that widening interest spreads, particularly for legal entities, significantly reduce liquidity levels, indicating a trade-off between profitability and liquidity stability. The findings further show that declines in deposit coverage of loans negatively affect liquidity, emphasizing the importance of deposit-based funding in sustaining stability. By applying the SVAR model, the study provides robust evidence of dynamic interactions among these factors, offering valuable insights for improving liquidity management strategies in Uzbekistan’s banking sector and enhancing resilience against systemic risks.