*Adebayo et.

al (2011)- Found that there is a significant relationship between liquidity

and profitability. Use Pearson correlation method, result was 1.55, confirmed the
positive relationship. Profitability is optimized when liquidity is effectively and efficiently
managed. (commercial bank)
*Idowu and Adegboyega (2017)- Use Pearson correlation co-efficient liquidity has
significant relationship on ROE and ROA. Liquidity and ROE has significant relationship,
liquidity and ROA less significant relationship. liquidity management maximizes returns
to shareholders but less than efficient utilization of assets.
*Agbada and Osuji (2013)- Result of Pearson product-moment correlation coefficient, (r)
read 0.861, deduce strong positive correlation between efficient liquidity management
and profitability.
*Ayodele and Oke (2013)- Deduced direct correlation between Bank’s liquidity and
profitability. Efficiency in liquidity management ensure that Banks’ liquid funds adequate
for its operations boost their profitability because liquid funds are converted to loanable
funds and advances to customers.
*Imad et al. (2011)- Use ROA and ROE to measure profitability, results showed that the
liquidity explain a significant part of the variation in banks’ profitability. High profitability
tends to be associated with well-capitalized banks, high lending activities, low credit
risk, and the efficiency of credit management.
*Alshatti (2015)- Uses ROE and ROA to measure profitability, investment ratio, quick
ratio, capital ratio and other ratios in measuring liquidity, investment ratio and quick ratio
has positive effect when measure by ROE, capital ratio has positive effect when
measured by ROA, other liquidity ratio has negative effect in profitability due to the
increased volume of untapped deposits of the banks. (commercial bank)
*Kajola et.al (2020)- Major finding is that two liquidity management variables (current
ratio and liquidity ratio) have direct impact on the profitability. Could not provide
empirical evidence in support of the other two liquidity management proxies (loan to
deposit ratio and deposit to asset ratio) as important liquidity management proxies that
could influence the profitability of banks.
*Bassey and Moses (2015)- Results show that liquidity management significant impact
on the profitability of returns to shareholders but has a weak impact on the profitability of
returns to asset. Liquidity management does not optimize the use of assets.
*Lartey et.al. (2013)- Weak positive relationship between the liquidity and the
profitability. When banks hold adequate liquid assets, their profitability would improve.
Adequate liquidity helps the bank minimize liquidity risk and financial crises.
Osborne, et al. (2012)- Relationship between liquidity and profitability is likely to be
highly cyclical. Positive during the periods of distress as banks that increase their
liquidity improve their profitability. Positive or negative relationship between liquidity and
profitability in the short-run depending on whether a bank is above or below its optimal
liquidity level.
Bordeleau and Graham (2010)- Liquidity assets tend to gain less profit, increasing
liquidity assets against default or bankruptcy may lower the cost. Positive relationship
between bank liquidity and profitability to some extent. liquidity assets banks hold
exceeds the threshold; too much liquidity may cause idle use of bank funds, which leads
to inefficiency of financial operations and investment management the relationship of
liquidity and profitability becomes negative.
Researcher Relationship Effect/Impact Profitability Sub Liquidity Sub Method Explanation Type of bank
Adebayo et.al Significant Positive Pearson Profitability is commercial
(2011) correlation optimized when
method, 1.55 liquidity is
effectively and
efficiently
managed.
Idowu and Significant to ROE and ROA Pearson Liquidity
Adegboyega ROE correlation co- management
(2017) Less significant efficient maximizes
to ROA returns to
shareholders but
less than
efficient
utilization of
assets.

Agbada and Strong Positive Pearson Efficient liquidity

Osuji (2013) product-moment management
correlation
coefficient,
0.861
Ayodele and Significant Efficiency in
Oke (2013) liquidity
management
ensure that
Banks’ liquid
funds adequate
for its operations
boost their
profitability
because liquid
funds are
 converted to
loanable funds
and advances to
customers
Imad et al. Significant ROA and ROE High profitability
(2011) tends to be
associated with
well-capitalized
banks, high
lending
activities, low
credit risk, and
the efficiency of
credit
management
Alshatti (2015) Positive- ROE and ROA investment Negative due to commercial
investment ratio, ratio, quick the increased
quick ratio to ratio, capital volume of
ROE; capital ratio and other untapped
ratio to ROA ratios to deposits of the
Negative- other measure banks
ratios in liquidity
measuring to
ROE and ROA
Kajola et.al Significant to current ratio (loan to deposit
(2020) current ratio and and liquidity ratio and deposit
liquidity ratio ratio; to asset ratio) as
Not significant to loan to deposit important
loan to deposit ratio and liquidity
ratio and deposit deposit to asset management
to asset ratio ratio proxies that
could influence
the profitability
 of banks.

Bassey and Significant to ROE and ROA Liquidity

Moses (2015) ROE management
Less significant does not
to ROA optimize the use
of assets.
Lartey et.al. Weak Positive When banks
(2013) hold adequate
liquid assets,
their profitability
would improve.
Adequate
liquidity helps
the bank
minimize
liquidity risk and
financial crises.
Osborne, et al. highly cyclical Positive during Positive or
(2012) the periods of negative
distress relationship
between liquidity
and profitability
in the short-run
depending on
whether a bank
is above or
below its optimal
liquidity level.
Mendoza and Negative
Rivera (2017)
Pardillo et.al. significant
(2018)