Non-performing loans in Baltic States: determinants and macroeconomic effects

Kjosevski, Jordan; Petkovski, Mihail

doi:10.1080/1406099x.2016.1246234

Cited by 70 publications

(79 citation statements)

References 30 publications

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“…This will increase the NPF ratio which will affect the decreasing bank profitability level. This finding is consistent with that done by Nursechafia and Abduh (2014), Iriani and Yuliadi (2015), Ghosh (2015), Rajha (2016), and Kjosevski and Petkovski (2017) which explains inflation as a macroeconomic factor affecting the risk of NPF at BPDUS in Indonesia. The coefficient of SBIS is 4.285, meaning that if SBIS rises by 10 points, it will increase the NPF by 42.85 points, otherwise, if SBIS decreases by 10 basis points then the NPF also decreases by 42.85 basis points.…”

Section: Proceedings Of Micoms 2017supporting

confidence: 92%

“…This will lower the NPF ratio which will impact on the increasing level of bank profitability. The results of this study are appropriated by Nursechafia and Abduh (2014), Iriani and Yuliadi (2015), Ghosh (2015), Rajha (2016), and Kjosevski and Petkovski (2017). They all conclude that macroeconomic variables or GDP as an important factor that cause financing risks in Islamic banking.…”

Section: Proceedings Of Micoms 2017mentioning

confidence: 57%

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What is the Determinant of Non-Performing Financing in Branch Sharia Regional Bank in Indonesia

Damanhur

Albra

Syamni

et al. 2018

Proceedings of MICoMS 2017

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Purpose-The aim of this study is to analyze the effects of macro-and micro-economic variables on the ratio of troubled financing (Non-Performing Financing, NPF). Design/Methodology/Approach-The method used in this research is the data panel fixed effect with 13 banks and 4 periods of data report (semi-annual report 2014-2015). Findings-The regression result achieved that variable inflation significantly influences the ratio of NPF. Variable Gross Domestic Product and assets total significantly influence the ratio of NPF too. While the SBI sharia's variable and Financing to Deposit Ratio did not significantly affect NPF in Syariah's Unit of Aceh Bank Pembangunan Daerah (BPD) in Indonesia. Research Limitations/Implications-This study uses panel data which are a combination of time series data and cross-section. Practical Implications-The policymakers can design a macro-policy carefully and better fiscal policies.

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Section: Proceedings Of Micoms 2017supporting

confidence: 92%

Section: Proceedings Of Micoms 2017mentioning

confidence: 57%

What is the Determinant of Non-Performing Financing in Branch Sharia Regional Bank in Indonesia

Damanhur

Albra

Syamni

et al. 2018

Proceedings of MICoMS 2017

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“…In this study, these three variables are alternatively used in each model in order to identify the most significant proxy determining the NPL level. As shown by Festic and Beko (2008), Kjosevski and Petkovski (2017) and Klein (2013), we expect their positive effect on banking stability.…”

Section: Macroeconomic Variablessupporting

confidence: 53%

Macroeconomic determinants of credit risks: evidence from high-income countries

Koju

Wang

2019

EJMBE

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Purpose The purpose of this paper is to empirically assess the significant indicators of macroeconomic environment that influence credit risk in high-income countries. Design/methodology/approach The study employs the system generalized method of moments estimator to avoid the dynamic panel bias and endogeneity issues. Different indices of economic growth are used in each model in order to find the most significant proxy of the economic cycle that influences problem loans. The analysis is carried out using a sample of 49 developed countries covering a 16-year period (2000–2015). Findings The overall empirical results highlight that the development of industrial sectors and exports are the main drivers of loan performance in high-income countries. The findings specifically recommend adopting an expansionary fiscal policy to boost per capita income and potential productivity for the safety of the banking system. Practical implications The findings have direct practical applicability for stabilizing the financial system. The study recommends the government to increase the productivity of export-oriented industries in order to boost employment and increase the payment obligations of individuals and business firms. More importantly, it highlights the essentiality of perfect economic policy to control default risks. Originality/value To the best of the authors’ knowledge, this is the first empirical study that compares the relative effect of three alternative proxies of the economic cycle on credit risk and identifies the most significant proxy. The current study also empirically shows that industrial development could be one of the crucial factors to improve financial health in developed countries.

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“…The similar studies were presented by Alhassan et al (2014) [21] and Kjosevski and Petkovski (2017) [22], the outcomes discovered that inflation rate and non-performing advances has positive connection among one another. The inflation will reduce the capacity of the borrowers in repaying debts, hence it direct affected the rises in non-performing loans.…”

Section: B Inflation Rate and Non-performing Loanssupporting

confidence: 69%

The Study on Factors That Influencing Banks’ Non-Performing Loans in Malaysia

Vaicondam,

Hishan,

Shan

2019

IJEAT

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The financial institution has played an important role to ensures macroeconomic stability in various economic sector. The effective and efficient performance in banking sector has contributed as an indicator of financial stability in any country. Non-performing advances have turned into the primary worry in research the factors that affecting the expansion of banks' non-performing advances in Malaysia. The main objective of the study is to study the factors that influence the bank’s non-performing loans (credits) in Malaysia. The three main factors studied are inflation, unemployment and interest rate. The secondary data from the Bank Negara Malaysia and CEIC Data. All the banks in Malaysia was included for the study. The time period was for ten years between the year 2009 – 2018. The results generated show consistency with the empirical studies and some contrary with the theories and finding of other researcher as well. The findings have shown the factors such as inflation, unemployment and interest rate has an influence in increasing the non-performing loans

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Non-performing loans in Baltic States: determinants and macroeconomic effects

Cited by 70 publications

References 30 publications

What is the Determinant of Non-Performing Financing in Branch Sharia Regional Bank in Indonesia

What is the Determinant of Non-Performing Financing in Branch Sharia Regional Bank in Indonesia

Macroeconomic determinants of credit risks: evidence from high-income countries

The Study on Factors That Influencing Banks’ Non-Performing Loans in Malaysia

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