American Journal of Business and Operations Research AJBOR 2692-2967 2770-0216 10.54216/AJBOR https://www.americaspg.com/journals/show/756 2018 2018 University of Kelaniya, SRI LANKA Nadhira .. College of Business Administration, Delta University for Science and Technology, Gamasa City, Dakhliya, Egypt Maha Saad Metawea There are considerable arguments in favour of and against the positive relationship between free cash flows (FCF) and financial flexibility. The aim of the study is to determine the impact of free cash flows on the financial flexibility of the banks listed in the Colombo Stock Exchange (CSE). The free cash flow will measure according to the model in Journal of Finance: Agency costs and ownership structure in 2000 and financial flexibility will determine using the financial leverage based on the model captured according to the Accounting Horizons Journal: Financial flexibility and investment decisions in 2007 . The population of the study is the banks listed in the CSE. The sample consists of 60 observations covering 12 banks for a period of over 05 years from 2015 to 2019. The panel regression model has been used to test hypotheses. The results indicate that there is a positive significant relationship between free cash flows and the financial flexibility of the banks listed in CSE. 2021 2021 23 27 10.54216/AJBOR.040102 https://www.americaspg.com/articleinfo/1/show/756