The purpose of this particular study is to determine if any liquidity risk exists in the Islamic banks of Pakistan and, if it does, what effect it has on the resilience of the industry in that country. The participants of this study are employees of Islamic banks. Our primary data was collected from three major cities in the country. This paper sheds light on the current situation in liquidity risk management. Further, we take a look at the attitudes of central and Islamic banks toward liquidity risk management policies. Regression models were applied in order to analyze the impact of liquidity risk management on Islamic banks. The findings show the effect of variables such as rational depositors and training on liquidity risk. The central bank provides Islamic banks with adequate rules and regulations, and the latter aim to control liquidity according to these rules as well as the requirements of depositors. The results of this paper offer useful insights for Islamic banks worldwide.
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