A Study of Liquidity and Interest Spread in Nepalese Cooperative Societies

Gyanendra Prasad Paudel; Suvash Khanal

doi:doi:10.11648/j.ijefm.20160406.11

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A Study of Liquidity and Interest Spread in Nepalese Cooperative Societies

Gyanendra Prasad Paudel, Suvash Khanal

Published in International Journal of Economics, Finance and Management Sciences (Volume 4, Issue 6)

Received: 14 May 2016 Accepted: 6 June 2016 Published: 3 November 2016

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Abstract

The study has inquired about the determinants liquidity risk and investment risk which are measured by liquid assets to deposit ratio and average interest spread respectively of Nepalese cooperative society. We did descriptive, correlation, and regression analysis of five year accounting data of 126 cooperatives of Kathmandu valley. The descriptive statistics show a huge gap between cooperatives with respect to size, earnings, activities, etc., and suggest that the cooperatives should be ranked and categorized according to their size so that a prompt regulation can be imposed to them. The significant positive correlation of deposit with variables such as investment, net earnings, size, liquid assets, interest earnings, interest expenses, etc. suggested deposit marketing is the most crucial instrument to build up size, to generate revenue and earnings, to increases the activities, etc. The finding from regression analysis show that the big sized cooperatives are lacking proper amount of liquidity, and suffering from liquidity risk. Moreover, the finding also suggests that strong permanent capital base have significant positive influence on adequate liquidity of the cooperatives. Similarly, cooperatives having higher credit to deposit ratio have liquidity deficit. The spread model suggests that cooperative bearing higher amount of investment risk are utilizing its assets efficiently, and holding an adequate amount of long term source of fund. Similarly, a big sized cooperative has abided with lower degree of investment risk.

Published in	International Journal of Economics, Finance and Management Sciences (Volume 4, Issue 6)
DOI	10.11648/j.ijefm.20160406.11
Page(s)	321-330
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2016. Published by Science Publishing Group

Keywords

Nepalese Cooperative Societies, Average Interest Spread, Liquidity Ratio

References

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Gyanendra Prasad Paudel, Suvash Khanal. (2016). A Study of Liquidity and Interest Spread in Nepalese Cooperative Societies. International Journal of Economics, Finance and Management Sciences, 4(6), 321-330. https://doi.org/10.11648/j.ijefm.20160406.11

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ACS Style

Gyanendra Prasad Paudel; Suvash Khanal. A Study of Liquidity and Interest Spread in Nepalese Cooperative Societies. Int. J. Econ. Finance Manag. Sci. 2016, 4(6), 321-330. doi: 10.11648/j.ijefm.20160406.11

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AMA Style

Gyanendra Prasad Paudel, Suvash Khanal. A Study of Liquidity and Interest Spread in Nepalese Cooperative Societies. Int J Econ Finance Manag Sci. 2016;4(6):321-330. doi: 10.11648/j.ijefm.20160406.11

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@article{10.11648/j.ijefm.20160406.11,
  author = {Gyanendra Prasad Paudel and Suvash Khanal},
  title = {A Study of Liquidity and Interest Spread in Nepalese Cooperative Societies},
  journal = {International Journal of Economics, Finance and Management Sciences},
  volume = {4},
  number = {6},
  pages = {321-330},
  doi = {10.11648/j.ijefm.20160406.11},
  url = {https://doi.org/10.11648/j.ijefm.20160406.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20160406.11},
  abstract = {The study has inquired about the determinants liquidity risk and investment risk which are measured by liquid assets to deposit ratio and average interest spread respectively of Nepalese cooperative society. We did descriptive, correlation, and regression analysis of five year accounting data of 126 cooperatives of Kathmandu valley. The descriptive statistics show a huge gap between cooperatives with respect to size, earnings, activities, etc., and suggest that the cooperatives should be ranked and categorized according to their size so that a prompt regulation can be imposed to them. The significant positive correlation of deposit with variables such as investment, net earnings, size, liquid assets, interest earnings, interest expenses, etc. suggested deposit marketing is the most crucial instrument to build up size, to generate revenue and earnings, to increases the activities, etc. The finding from regression analysis show that the big sized cooperatives are lacking proper amount of liquidity, and suffering from liquidity risk. Moreover, the finding also suggests that strong permanent capital base have significant positive influence on adequate liquidity of the cooperatives. Similarly, cooperatives having higher credit to deposit ratio have liquidity deficit. The spread model suggests that cooperative bearing higher amount of investment risk are utilizing its assets efficiently, and holding an adequate amount of long term source of fund. Similarly, a big sized cooperative has abided with lower degree of investment risk.},
 year = {2016}
}

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TY  - JOUR
T1  - A Study of Liquidity and Interest Spread in Nepalese Cooperative Societies
AU  - Gyanendra Prasad Paudel
AU  - Suvash Khanal
Y1  - 2016/11/03
PY  - 2016
N1  - https://doi.org/10.11648/j.ijefm.20160406.11
DO  - 10.11648/j.ijefm.20160406.11
T2  - International Journal of Economics, Finance and Management Sciences
JF  - International Journal of Economics, Finance and Management Sciences
JO  - International Journal of Economics, Finance and Management Sciences
SP  - 321
EP  - 330
PB  - Science Publishing Group
SN  - 2326-9561
UR  - https://doi.org/10.11648/j.ijefm.20160406.11
AB  - The study has inquired about the determinants liquidity risk and investment risk which are measured by liquid assets to deposit ratio and average interest spread respectively of Nepalese cooperative society. We did descriptive, correlation, and regression analysis of five year accounting data of 126 cooperatives of Kathmandu valley. The descriptive statistics show a huge gap between cooperatives with respect to size, earnings, activities, etc., and suggest that the cooperatives should be ranked and categorized according to their size so that a prompt regulation can be imposed to them. The significant positive correlation of deposit with variables such as investment, net earnings, size, liquid assets, interest earnings, interest expenses, etc. suggested deposit marketing is the most crucial instrument to build up size, to generate revenue and earnings, to increases the activities, etc. The finding from regression analysis show that the big sized cooperatives are lacking proper amount of liquidity, and suffering from liquidity risk. Moreover, the finding also suggests that strong permanent capital base have significant positive influence on adequate liquidity of the cooperatives. Similarly, cooperatives having higher credit to deposit ratio have liquidity deficit. The spread model suggests that cooperative bearing higher amount of investment risk are utilizing its assets efficiently, and holding an adequate amount of long term source of fund. Similarly, a big sized cooperative has abided with lower degree of investment risk.
VL  - 4
IS  - 6
ER  -

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Author Information

Gyanendra Prasad Paudel

Nepal Merchant Cooperative Limited, Mahabouddha, Kathmandu, Nepal
Suvash Khanal

Kist College of Management, Kathmandu, Nepal

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APA Style

Gyanendra Prasad Paudel, Suvash Khanal. (2016). A Study of Liquidity and Interest Spread in Nepalese Cooperative Societies. International Journal of Economics, Finance and Management Sciences, 4(6), 321-330. https://doi.org/10.11648/j.ijefm.20160406.11

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ACS Style

Gyanendra Prasad Paudel; Suvash Khanal. A Study of Liquidity and Interest Spread in Nepalese Cooperative Societies. Int. J. Econ. Finance Manag. Sci. 2016, 4(6), 321-330. doi: 10.11648/j.ijefm.20160406.11

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AMA Style

Gyanendra Prasad Paudel, Suvash Khanal. A Study of Liquidity and Interest Spread in Nepalese Cooperative Societies. Int J Econ Finance Manag Sci. 2016;4(6):321-330. doi: 10.11648/j.ijefm.20160406.11

Copy | Download

@article{10.11648/j.ijefm.20160406.11,
  author = {Gyanendra Prasad Paudel and Suvash Khanal},
  title = {A Study of Liquidity and Interest Spread in Nepalese Cooperative Societies},
  journal = {International Journal of Economics, Finance and Management Sciences},
  volume = {4},
  number = {6},
  pages = {321-330},
  doi = {10.11648/j.ijefm.20160406.11},
  url = {https://doi.org/10.11648/j.ijefm.20160406.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20160406.11},
  abstract = {The study has inquired about the determinants liquidity risk and investment risk which are measured by liquid assets to deposit ratio and average interest spread respectively of Nepalese cooperative society. We did descriptive, correlation, and regression analysis of five year accounting data of 126 cooperatives of Kathmandu valley. The descriptive statistics show a huge gap between cooperatives with respect to size, earnings, activities, etc., and suggest that the cooperatives should be ranked and categorized according to their size so that a prompt regulation can be imposed to them. The significant positive correlation of deposit with variables such as investment, net earnings, size, liquid assets, interest earnings, interest expenses, etc. suggested deposit marketing is the most crucial instrument to build up size, to generate revenue and earnings, to increases the activities, etc. The finding from regression analysis show that the big sized cooperatives are lacking proper amount of liquidity, and suffering from liquidity risk. Moreover, the finding also suggests that strong permanent capital base have significant positive influence on adequate liquidity of the cooperatives. Similarly, cooperatives having higher credit to deposit ratio have liquidity deficit. The spread model suggests that cooperative bearing higher amount of investment risk are utilizing its assets efficiently, and holding an adequate amount of long term source of fund. Similarly, a big sized cooperative has abided with lower degree of investment risk.},
 year = {2016}
}

Copy | Download

TY  - JOUR
T1  - A Study of Liquidity and Interest Spread in Nepalese Cooperative Societies
AU  - Gyanendra Prasad Paudel
AU  - Suvash Khanal
Y1  - 2016/11/03
PY  - 2016
N1  - https://doi.org/10.11648/j.ijefm.20160406.11
DO  - 10.11648/j.ijefm.20160406.11
T2  - International Journal of Economics, Finance and Management Sciences
JF  - International Journal of Economics, Finance and Management Sciences
JO  - International Journal of Economics, Finance and Management Sciences
SP  - 321
EP  - 330
PB  - Science Publishing Group
SN  - 2326-9561
UR  - https://doi.org/10.11648/j.ijefm.20160406.11
AB  - The study has inquired about the determinants liquidity risk and investment risk which are measured by liquid assets to deposit ratio and average interest spread respectively of Nepalese cooperative society. We did descriptive, correlation, and regression analysis of five year accounting data of 126 cooperatives of Kathmandu valley. The descriptive statistics show a huge gap between cooperatives with respect to size, earnings, activities, etc., and suggest that the cooperatives should be ranked and categorized according to their size so that a prompt regulation can be imposed to them. The significant positive correlation of deposit with variables such as investment, net earnings, size, liquid assets, interest earnings, interest expenses, etc. suggested deposit marketing is the most crucial instrument to build up size, to generate revenue and earnings, to increases the activities, etc. The finding from regression analysis show that the big sized cooperatives are lacking proper amount of liquidity, and suffering from liquidity risk. Moreover, the finding also suggests that strong permanent capital base have significant positive influence on adequate liquidity of the cooperatives. Similarly, cooperatives having higher credit to deposit ratio have liquidity deficit. The spread model suggests that cooperative bearing higher amount of investment risk are utilizing its assets efficiently, and holding an adequate amount of long term source of fund. Similarly, a big sized cooperative has abided with lower degree of investment risk.
VL  - 4
IS  - 6
ER  -

Copy | Download