Abstract
The objective of the study was to examine what relationship might exist
between the financial performance and the total risks of the commercial
banks listed at Amman Stock Exchange (ASE). Six indicators are used;
profitability, leverage, liquidity, capital adequacy, assets quality and
revenue quality. Total risks were measured by the standard deviation over
the period January 2000 to December 2006. Data used were collected from
official sources for eleven banks.
The study indicates that profitability is the only financial performance
measure which has a significant negative effect on the total risks of the
commercial banks’ stocks traded at ASE, sixteen percent of the total risks
vitality of the stock prices are due to that variable, the rest of the percentage
change is due to other factors not included in the model