Essay on the determinants of liquidity risk in participatory banks in Morocco

Abstract

Liquidity management in the context of Islamic finance has gained increasing importance in recent years. As a result, Islamic banks are facing a growing challenge due to the nature of Islamic financial operations, as well as the fundamental guiding principles of Sharia law. In such a context, second-tier banks are confronted with liquidity management issues, particularly in the short-term dynamics. Through this research, we aim to highlight the determinants of liquidity risk in Moroccan participatory banks. To conduct this research, we will attempt to build our empirical analysis using statistical modeling through the ARDL model, in order to determine the parameters that may impact the level of liquidity in Moroccan participatory banks, and also to explore the most appropriate solutions suited to the Moroccan context.