Purpose: The purpose of this paper is to analyze some of the determinants of credit risk in commercial banks in Kosovo through the use of regression analysis for a dataset covering a time series of 7 years (2012-2018). Design/Methodology/Approach: The data have been collected from publications of Central Bank of Kosovo and from Kosovo Agency of Statistics The data have been analyzed on quarterly basis. In order to conduct the empirical part of the study that gives us the answer to the relationship between credit risk and the determinants of this risk, we analyzed 6 variables in the study. To perform the necessary analysis we have used the statistical software SPSS 23. Through the regression analysis, the main findings and results of the study were generated. Findings: After analyzing the necessary data, the paper concludes that, among credit risk determinants, interest rates on loans and profitability of banks (ROA) have the largest and most significant impact on credit risk, namely non-performing loans as the credit risk measure. Practical implications: For researchers and academics, the study provides a useful basis on which further studies on credit risk and the factors that cause this risk can be conducted. Originality/Value: The research paper is based on recent studies that assess credit risk in other countries and use reliable data on the banking sector in Kosovo.
With the rapid development of manufacturing forces, national markets are becoming very small, while the need for economic cooperation between countries is becoming ever greater. Economic and trade cooperation between countries is the only way for small countries to benefit from large markets. Viewed from the aspect of transition countries, this collaboration offers domestic producers the opportunity to link to global chains. For a small and new country like Kosovo, good economic and trade relations with neighboring countries are of great importance. Free trade with the countries of the region is of the utmost importance for Kosovo because it not only allows the import of raw materials and products that are not produced domestically, but it also provides potential markets for its exports. However, we recognize the fact that in terms of carrying out trade activities in relation to other countries, Kosovo faces a continuing problem that is the trade balance deficit as a result of its dependence on imports and as a result of its, in development constraints of exports. Kosovo is the smallest country in the region due to its size, but also by its economic and trade impact in the region. It is characterized by a lack of domestic economic development, namely with lack of the manufacturing sector and industry, and as a result, it can not satisfy domestic demand, which the demand is then forced to cover mainly by imports, by thus affecting the growth of the trade balance deficit.The purpose of this paper is to analyze the trends in Kosovo's foreign trade through various data published by relevant institutions, in order to look at the directions and trends in the development of trade activities with other countries, mainly with the countries of the Western Balkans (Albania, Bosnia and Herzegovina, Macedonia, Montenegro and Serbia) and to seen the importance of this economic and trade cooperation. Based on this database and the comparisons made over the years, conclusions are drawn regarding the current trade conditions between Kosovo and these countries, their economic relations within CEFTA and the EU and their long-term economic orientation. Given the unfavorable trade situation in the region, it is necessary for the Balkan countries to strengthen their friendly bridges and to increase economic cooperation with a view to the mutual development of trade. This will most certainly contribute to an accelerated economic development for these countries as well as to improving the relations of the countries of the region. Creating a good relationship between the countries of the region is also the main goal of CEFTA, which enables the creation of a free trade zone for the Western Balkan countries. The path to prosperity for the Western Balkans depends on the progress of regional and international economic integration by linking with global markets through trade, transport, and investment.
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