Abstract:

Profitability play very important role in every organization. In banking sector t tells about how much we have earn against its expenses and how much we have to bear within a year or more than one year. And this research paper shows the impact of liquidity management on profitability. Liquidity means that easily covetable to cash in other words those assets which are can be converted into cash in short term period. And profitability means revenues more than its total expense is called profitability. And the banking sector of Pakistan is chose as sector and country is Pakistan and there is a significant relationship between liquidity and profitability eight 8 banks financial reports are taken and 8 years data is taken from 2004 to 2015 for this research paper and the banks are selected bank of Punjab, allied bank, united bank, askari bank, alfalah bank, meezan bank, jahangir saddiqui bank and Muslim commercial bank limited are selected. Pooled analysis is used to summarize the data of correlation and regression. There was a short time to collect data more than eight banks and 8 years data and further it is suggested that new researcher can take more than eight 8 banks and can take more than 8 years data from financial reports and also can take other formulas in profitability and liquidity like quick ratio, return on equity, return on investment and net profit margin as for further research and also can take other ratios as dependent and independent variable in different sectors. Key Words: Banking Sector, Liquidity Management, Profitability.

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