The Effect of Financial Risks on the Financial Performance of Banks listed on Bahrain Bourse: An Empirical Stud

Authors

Fatema Jasim Mohamed Jasim Harban, College of Administrative Sciences Applied Science University, East Al-Ekir, Kingdom of Bahrain.Follow
Basel J. A. Ali, College of Administrative Sciences Applied Science University, East Al-Ekir, Kingdom of Bahrain.Follow
Mohammad Salem Oudat, College of Administrative Sciences Applied Science University, East Al-Ekir, Kingdom of Bahrain.Follow

Abstract

The present paper aims to examine the effect of financial risks on the financial performance of banks listed on Bahrain Bourse. SPSS 22 was adopted to analyze the data. Descriptive test in addition to multiple regression were used. To achieve the study objectives, capital risk, exchange rate risk, liquidity risk, and operational risk represented the independent variables as well as the return on assets and return on equity were used to measure the dependent variable. Data were extracted from the annual reports of the 13 sampled banks from 2014 to 2018. The results demonstrated no significant effect of the exchange rate risk, liquidity risk, operational risk, and bank size on the financial performance of the banks measured by the return on assets. However, there was a positive effect of capital risks on the performance of the banks. Moreover, there were no significant effect of all the variables on return on equity. The study recommends extending this study by conducting comparative studies for other sectors, such as insurance sector, in Kingdom of Bahrain and Gulf.

Recommended Citation

Jasim Mohamed Jasim Harban, Fatema; J. A. Ali, Basel; and Salem Oudat, Mohammad (2021) "The Effect of Financial Risks on the Financial Performance of Banks listed on Bahrain Bourse: An Empirical Stud," Information Sciences Letters: Vol. 10 : Iss. 4 , PP -.
Available at: https://digitalcommons.aaru.edu.jo/isl/vol10/iss4/5