Bank credit risk and credit information sharing in Africa: Does credit information sharing institutions and context matter?

Does credit information sharing affect funding cost of banks? Evidence from African banks

“…Thus, credit information sharing enhance and reinforce transparency, hence reduction financial market risk leading to decline in funding cost. Again, the study confirms that the assertion of private bureaus is more effective than public registries (see Kusi et al, ; Miller, ) as the coverage of public credit registries are not significant in reducing funding cost but coverage of private bureaus significantly reduced funding cost of banks.…”

“…Second, the study employs different measures of information sharing to investigate its effect on bank funding cost in the context of Africa. Third, the study tests the assertion that private credit bureaus are effective than public credit registries (see Kusi et al, 2017;Miller, 2003). Fourth, credit information sharing in Africa is quite recent, and this study will make policy contributions for effective and efficient use of credit information.…”

“…Hence, high rate charges by banks due to increased funding cost caused by increased information asymmetry that stifle financial intermediation and slowdown economic growth and development. In the light of the later, the literature also suggests that the effect information asymmetry can be reduced through credit information sharing in the financial market (see Freimer & Gordon, 1965;Freixas & Rochet, 2008;Kusi, Agbloyor, Ansah-Adu, & Gyeke-Dako, 2017;Luoto, McIntosh, & Wydick, 2007;Stiglitz & Weiss, 1981). It is therefore not surprising to find a rapidly improving credit information sharing in Africa for the last few decades (Kusi et al, 2017;Kusi, Agbloyor, Fiador, & Osei, 2015, 2016.…”

Information asymmetry, financialization, and financial access

“…Muazu and Alagidede (2017) conclude that, compared to countries with French civil law traditions, their counterparts with English common law traditions benefit more from financial access arising from the introduction of ISOs. Kusi, Agbloyor, Ansah-Adu, and Gyeke-Dako (2017) have established that ISOs reduce bank credit risk in high-and low-income countries in Africa, while Kusi and Opoku-Mensah (2018) have concluded that the presence, quality, and coverage of ISOs decreases funding costs in Africa.…”

The Stability of Demand for Money in the Proposed Southern African Monetary Union

“…The findings show divergence across countries in the stability of money. This divergence is articulated in terms of differences in, cointegration, CUSUM (cumulative sum) and 5 The positioning of this research is also partially motivated by a growing strand of literature on the relevance of sovereign debt, financial access and alternative mechanisms of financing in Africa's development (Gevorkyan & Kvangraven, 2016;Danquah et al, 2017;Amponsah, 2017;Boamah, 2017;Kusi et al, 2017;Bayraktar & Fofack, 2018;Tchamyou, 2019aTchamyou, , 2019bBoateng et al, 2018;Kusi & Opoku-Mensah, 2018;Dafe et al, 2018;Gyeke-Dako et al, 2018;Tchamyou et al, 2019;Bokpin et al, 2018;Asongu & Odhiambo, 2019). CUSUMSQ (CUSUM squared) tests, short run and long-term determinants and error correction in event of a shock.…”