EVALUATING THE EFFICIENCY OF JORDANIAN COMMERCIAL BANKS BEFORE AND DURING THE COVID-19 PANDEMIC

Abstract

The current research aims to investigate the financial management of Jordanian listed banks during the COVID-19 pandemic to identify the impact of the COVID-19 pandemic on the financial management efficiency of Jordanian banks during the pandemic. In addition, this research is based on a quantitative research approach as it incorporates financial management factors, including liquidity management, return on equity, return on assets, and financial performance, for identifying the efficiency of Jordanian banks during the COVID-19 pandemic. The analysis shows the financial indicators of banks listed on the Amman stock exchange. It has been found that the pandemic has affected the financial performance of these banks. On one side, although the total asset (size) of the banking sector is found to be increased on the other side, the debt ratio has also been increased, and it has created a significant negative impact on the financial performance. Hence, the findings indicate that the Jordanian government and the central bank of Jordan are still required to work on enhancing the financial performance of the financial sector in Jordan, as well as they should work on eliminating the impact of COVID-19 on the financial sector. Moreover, the reforms introduced by the Central bank of Jordan have a significant role in having this efficiency by the listed banks. This paper has highlighted that Jordan has a strong banking system that can cope with such uncertain situations due to its efficient financial management practices. The Jordanian government should further enhance the capabilities of the Jordanian banking sector through effective reforms to further contribute to the country's economic development.