Mwabulambo, Nwaka Godfrey2019-07-022020-01-082019-07-022020-01-082011Mwabulambo, N. G. (2011) Regulatory treatment of liquidity risk in Tanzania: the case of selected commercial banks. Master dissertation, University of Dar es Salaam. Avaialble at http://41.86.178.3/internetserver3.1.2/detail.aspxhttp://localhost:8080/xmlui/handle/123456789/4830Available in printThe result of not managing liquidity risk properly may have dire consequences for banks because a liquidity crisis may happen without warning. Therefore if banks are to correctly manage liquidity risk, the practices must be in line with regulators liquidity prudential requirements. This study sought to explore the possible gap between the current practices in liquidity risk management and the regulatory treatment thereof. Analysis of liquidity risk in Tanzania was conducted to assess whether it is valid for regulators to require banks to hold capital for liquidity risk and determine whether liquidity risk is a threat to Tanzania economy. This study was designed to analyze the regulatory treatment of liquidity risk in Tanzania. The study used both primary and secondary data with the aim of enhancing the research findings. Published financial statements were collected principally from selected banks. Primary data were collected through questionnaires and interviews with responsible Heads of Treasury. This study has established that capital would not be an effective mitigant for liquidity risk. Liquidity risk differs from bank to bank and a general capital charge for all banks may not be sensible. Likewise capital would be expensive and restrictive to banks.. This study concludes that liquidity risk is not perceived to be a threat in Tanzania, but banks are well aware of the devastating effects a liquidity crisis could have. Furthermore, it is recommended that banks should be allowed to use internal models to measure liquidity risk. However the models should be subject to the Bank of Tanzania approval.enRegulatory treatmentliquidity riskcommercial banksTanzaniaThesis