Comparative Analysis of Liquidity and Profitability of Foreign and Domestic Capital Banks

After the 2008 global economic crisis, banks' exposure to liquidity risk did not only result in a decrease in their profitability; It also had negative effects on the stability of the financial system. One of the most important performance indicators used to measure the financial success of banks is their profitability. One of the many parameters aimed at increasing the profitability of banks is the liquidity structures of them and it is known that there is a positive relationship between risk and profitability. In this study, the relationship between the profitability of commercial banks and the liquidity risks they carry has been tried to be revealed by comparatively examining in terms of domestic banks and banks with foreign capital. As a result of the study, it has been determined that the return on assets of foreign capital banks is higher than the domestic capital banks, and the return on equity of domestic banks is higher than the profits of foreign banks. It has been found that the liquidity levels are higher in banks with foreign capital. It has been observed that there is a statistically significant positive relationship between return on assets and liquidity only in foreign banks.