Academy of Accounting and Financial Studies Journal (Print ISSN: 1096-3685; Online ISSN: 1528-2635)

Abstract

Performance Measurement of Commercial Banks in Jordan Using the Camels Rating System

Author(s): Ahmad Ali Bawaneh, Ahmad Dahiyat

This study aims to present a comprehensive financial evaluation of commercial banks listed on the Amman Stock Exchange by using the parameters of the CAMELS (Capital adequacy, Asset quality, Management efficiency, Earning quality, Liquidity, and Sensitivity to risks) rating system. The study also aims to determine the effect of the CAMELS system on the performance of the banks. The study relies on an analysis of the available annual reports of all commercial listed banks (13) for the period of 2012–2018 which were extracted from the Amman Stock Exchange website. Multiple linear regression and other statistical methods were used to obtain the descriptive results and to measure the effect of the CAMELS dimensions on the performance of commercial banks. The study concluded that there is a significant effect of the CAMELS dimensions management efficiency, earning quality, liquidity, and risk sensitivity on the financial performance of commercial banks, but there is no statistically significant effect of the CAMELS dimensions capital adequacy and asset quality on the performance of commercial banks.

Get the App