ASSESSMENT OF LIQUID ASSET MANAGEMENT PRACTICE: (THE CASE OF COMMERCIAL BANK OF ETHIOPIA, WOLIKITE BRANCH)

Abstract

The term liquid asset management is one of the most fundamental topics in the field of corporate finance. It refers to the firm’s investment in inventory, accounts receivable, cash and liquid securities, all of which constitute short-term assets. This study would attempt to examine the assessment of liquid asset management practices in the case of commercial bank of Ethiopia wolikite branch . One of the major problems of financial institution was improper management of liquid asset which were have greater impact for the survival of the company, because of liquidity problem. This bank engaged in providing different kinds of financial service like domestic and international banking service. The study would attempt to address the research questions having attention in the statement of the problem and objective of the study. The main objective of the study was to assess the liquid asset management technique, the bank policies and procedure to manage liquid asset, loan authorization and collection. The research design was descriptive type. More over both primary and secondary data from the bank was collected. The primary data sources were from interview, while secondary data includes the two years audited financial statement or annual reports. The respondents of interview were selected with non probability sampling using judgmental sampling. The respondents were finance (liquid) assets manager and credit manager of the bank. The data from both sources were analyse and interpreted using table, figure and percentage. Based on the analysis and finding, conclusions and recommendation were made.