Evaluating the Financial Soundness of the Jordanian Commercial Banks by Applying BankoMeter’s Model

Abstract

In the developing countries like Jordan, banking sector injects funds in the body of the organizational and economical development. Thus, regarding to the importance of its vital function the study aimed to evaluate the financial soundness of thirteen Jordanian commercial banks, during the period of 2002-2011. After analyzing the intended data, the study found that all of the Jordanian Commercial banks are financially sound and termed as super sound banks. However, the Arab Banking Corporation it reached the peak followed by Capital Bank of Jordan, and for Cairo Amman Bank it stood at the 13^th position within solvency ratio of (0.8711). By hanging on these results, the study concluded that the Bankometer could help the commercial Jordanian banks’ internal management to eschew insolvency issues with a proper control over their operations.

Keywords: Financial Soundness & Stability, BankoMeter’s Model/ Parameters, Commercial Banks, & CAR.