International Journal of Academic Research in Accounting, Finance and Management Sciences

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Capital Adequacy of the Jordanian Banking Sector for the Period 2000-2013

Open access
The study seeks to identify the capital adequacy of the Jordanian banking system for the period 2000-2013. The researcher adopted the descriptive and the analytical approaches to identify the capital adequacy of the Jordanian banking system depending on data obtained from the Amman Stock Exchange Market, the Central Bank of Jordan and the Jordanian Ministry of Finance for the period 2000 - 2013. The study showed that there is a statistically significant relationship between the capital adequacy and liquidity. There is a statistically significant relationship between capital adequacy and credit risk. There is a statistically significant relationship between capital adequacy and the capital risk. There is a statistically significant relationship between capital adequacy and investments in the securities portfolio. The researcher recommends the commercial banks to increase their strategic planning and management capacity to utilize any rise in capital to increase profits. They should develop market and operational risk assessment methods to be included in the calculation of capital adequacy ratio of the commercial banks. Further studies should be conducted on the capital the adequacy of the Jordanian commercial banks.