Measuring the Dependency of the Banks’ Assets and Liabilities in Iran

Analyzing the correlation between banks’ assets and liabilities after the financial crisis has been focused by many countries. As the banks in Iran have proved to be the biggest financer required for the production sector, investigating the asset and liability portfolio and their correlation appears to be very important. In this paper, there has been an attempt to patronize the Iranian banking network’s balance sheets during the course of ۲۰۰۶-۲۰۱۵ and the standard methods of measuring correlation coefficient to evaluate the dependency degree among the assets and liabilities of the banks in order to scrutinize its trend. Results show some similarities between the two banking sectors. First, for two banking sectors alike, neither the asset nor the liability side of the balance sheet alone can be held responsible for the declining asset-liability dependencies. Second, all two banking sectors have experienced declining dependencies of loans to non-banks and  deposits, while dependencies of the security and investment increase and the dependency of the liability from central bank did not change significantly during the period of our study.

Keywords:

asset-liability dependency , canonical correlation , balance sheets