Liquidity management in a small local financial intermediary : the case of APS Bank Ltd.

Abstract

This dissertation will discuss the role of liquidity management in the banking industry with special emphasis to a small bank's scenario. Managing and measuring liquidity have become among the most vital activities of commercial banks enabling financial intermediaries to meet their liabilities as they fall due. A sound liquidity position is a must in today's financial environment since it is the determinant of whether an institution will be in operation in the foreseeable future. This work is aimed at highlighting the importance of liquidity management in the banking world whilst trying to compare theory with practical aspects taken from the local scenario. Moreover, further emphasis will be made in trying to distinguish between large and small banks and how this difference in size may affect the way directors look at liquidity management.