Measuring Financial Strength Using the Profitability Index and its Impact on Achieving Financial Soundness: An Analytical Study of Several Iraqi Private Commercial Banks

Abstract

The research focuses on measuring the profitability and financial soundness and evaluating their relationship and impact. The study aimed to measure and analyze financial strength using the profitability indicator and its impact on achieving financial Soundness. Ashur International Bank, National Bank of Iraq, Commercial Bank of Iraq, Gulf Commercial Bank) and the research started from a main hypothesis that (there is a significant effect of profitability on financial soundness in terms of its indicators of capital adequacy, quality of assets, liquidity), and the researchers used the statistical method to reach The results using the statistical program 10Eviews. The research concluded that profitability achieves financial soundness in the surveyed banks. The research also recommends investing in liquidity and achieving a balance between liquidity and profitability according to risk management.