Nonperforming Loans in Albania

Turan, Güngör; Koskija, Arjeta

doi:10.5901/ajis.2014.v3n3p491

Cited by 11 publications

(11 citation statements)

References 6 publications

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“…Authors analysing the impact of economic factors focus both on external events such as general macroeconomic conditions, which could impact on the ability of borrowers to repay their loans, and the variability of NPLs through banks. Turan and Koskija (2014) problems caused by the economic crisis and the decrease of emigrant incomes. They use quarterly data for the period 2003 to 2013 and a multivariate co-integration test to reveal that NPLs and real GDP, unemployment, inflation, loan interest rate and remittances are co-integrated in the long run, but not in a strong way.…”

Section: Literature Reviewmentioning

confidence: 99%

“…The sharp rise in non-performing loans (NPLs) in the last decade has caught the attention of many scholars around the world to try to explain this phenomenon. Various authors such as Anjom and Karim (2015), Turan and Koskija (2014), Çeliku and Luçi (2003), Clichici and Colesnicova (2014), Kurumi and Bushpupa (2017), and Hanifan Fajar and Umanto (2017), have studied the impact of macroeconomic factors on the level of NPLs. They reveal a relationship between macroeconomic factors and specific bank factors on NPLs in transition countries and note that Gross Domestic Product (GDP), inflation and unemployment had a significant positive impact on decreasing NPLs.…”

Section: Introductionmentioning

confidence: 99%

“…However, some authors feel that today there is a need for a wider search in order to uncover the reasons behind such growth. They are of the opinion that one should investigate macroeconomic factors related to the environment in which the banking system operates (Turan and Koskija, 2014). The liberalization of centralized economies and the meltdown of the Comecon markets led to major changes in relative prices of goods and services, as well as a significant reduction in foreign trade activity for most Central and South-Eastern European countries as well as former Soviet Union countries.…”

Section: Introductionmentioning

confidence: 99%

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Determinants of the Level of Non-Performing Loans in Commercial Banks of Transition Countries

Mazreku¹,

Morina²,

Misiri³

et al. 2018

ERSJ

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Problem loans have generated considerable academic and policy attention in recent years, fueled in part by the aftermath of the 2008-2009 economic crisis and subsequent credit crunch. Problem loans, referred to as non-performing loans (NPL), are loans which are not paid in the structured time period as set in the contract between the borrower and the bank. The goal of this study is to show the influence, in transition countries, of macroeconomic factors on the level of these loans. Specifically, factors such as Gross Domestic Product (GDP growth), inflation, unemployment and export growth shall be considered, using a variety of econometric models and specifications to ensure robustness, including Fixed and Random Effects Models and Arellano-Bond Dynamic Panel estimation. We use data from the World Bank and International Monetary Fund for a sample of transition countries over the period 2006 and 2016. Findings show that GDP growth and inflation are both negatively and significantly correlated with the level of NPLs, while unemployment is positively-related to NPLs. These results have important implications for banking stability within transition countries, and the role of macroeconomic policies in this regard.

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Section: Literature Reviewmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Determinants of the Level of Non-Performing Loans in Commercial Banks of Transition Countries

Mazreku¹,

Morina²,

Misiri³

et al. 2018

ERSJ

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“…The enhanced quality of banks' reserves is due to faster growth in nominal income and credit, expanded financial inclusion, as well as the attempts of supervisory authorities to enhance the control of banks' credit risk and underwriting activities. In recent years, the non-performing loan -fundamental macro nexus have attracted immense interest among scholars (Dimitrios et al, 2016;Anjom & Karim, 2016;Turan & Koskija, 2014;Ghosh, 2015;Grigoli et al, 2018;Makri et al, 2014).…”

Section: Introductionmentioning

confidence: 99%

Nexus between financial innovations, remittances and credit performance: Evidence from augmented ARDL and nonlinear ARDL

Qamruzzaman

2021

Investment Management and Financial Innovations

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The motivation for this study is to assess the impact of financial innovation and remittances on bank-based financial institutions’ credit performance in Bangladesh for the period 1981–2019. The study applies augmented ARDL (AARDL) and nonlinear ARDL (NARDL) to identify both long-run and short-run effects and directional causality by performing non-granger casualty tests. AARDL confirms the presence of a long-run association between financial innovation, remittance, trade openness, FDI, and credit performance, which is measured by non-performing loans. In the long run, financial innovation and FDI volatility expose a positive link with NPLs, but remittance inflows and trade openness establish a negative association. Asymmetry shocks in financial innovation reveal a positive relationship with credit performance. In contrast, the asymmetric shock of remittance and trade openness unveil a negative tie to credit performance, especially in the long run. Furthermore, directional causality provides evidence to support a feedback hypothesis explaining causality between financial innovation and credit performance, as well as remittance inflows and credit performance. These findings suggest that credit performance is guided by future development in remittances and financial innovation; thus, closer attention from policymakers and financial experts is persistent to capitalize or mitigate the impact of the financial system.

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“…Different empirical results have been presented by the author(s) and there are some researchers supporting the effects of macroeconomic variables on NPLs, and they can be presented as follows: Jayaratne and Strahan (1996), Gambera (2000), Domac and Peria (2000), Arpa et al (2001), Kalirai and Scheicher (2002), Shu (2002), Quagliariello (2003), Ranjan and Dhal (2003), Jimenez and Saurina (2006), Ghosh (2007), Bebczuk and Sangiácomo (2008), Cifter et al (2009), Espinoza and Prasad (2010), Dash and Kabra (2010), Bofondi and Ropele (2011), Vogiazas andNikolaidou (2011), Yuksel (2011), Adebola et al (2011), Nkusu (2011, Alper and Anbar (2011), Louzis et al (2012), Swami (2012), Saba et al (2012), Farhan et al (2012), Zeng (2012), Mileris (2012), Macit (2012), Messai and Jouini (2013), Beck et al (2013), Badar et al (2013), Otasevic (2013, Vatansever and Hepsen (2013), Klein (2013), Messai and Jouini (2013), Ahmad and Bashir (2013), Castro (2013), Ebeke et al (2014), Sahbaz andInkaya (2014), Makri et al (2014), Clichici and Colesnicova (2014), Prasanna (2014), …”

Section: Introductionmentioning

confidence: 99%

Do Macroeconomic Variables Have a Symmetric or Asymmetric Effect on Non-Performing Loans? Evidence From Turkey

Erdaş¹

2019

Mehmet Akif Ersoy Üniversitesi İktisadi Ve İdari Bilimler Fakültesi Dergisi

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In this study, the existence of the relationships between non-performing loans and macroeconomic variables for the monthly data of the Turkish banking sector between January 2005 and August 2018 were analysed through the Johansen cointegration test (1991), VECM Granger causality test (1988) and Hatemi-J asymmetric causality test (2012). The results of the Johansen cointegration test indicated that there are significant cointegration relationships between the variables in long-run. According to Granger causality test based on VECM, unidirectional causalities exists between non-performing loans, market capitalisation, exchange rate, industrial production index and foreign trade deficit. Except for market capitalization, those causality relationships were determined to be directed from the macroeconomic variables to NPLs. Under Hatemi-J (2012) asymmetric causality test, the results revealed that there exists asymmetric causality relation between NPLs and other macroeconomic variables excluding the consumer price index. It is possible to verify as a result of the analysis that the causality relationships between the variables differ and NPLs are affected as long as the macroeconomic conditions change. The results also revealed that the NPLs in the Turkish banking sector are different before and after the recent global financial crisis.

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Nonperforming Loans in Albania

Cited by 11 publications

References 6 publications

Determinants of the Level of Non-Performing Loans in Commercial Banks of Transition Countries

Determinants of the Level of Non-Performing Loans in Commercial Banks of Transition Countries

Nexus between financial innovations, remittances and credit performance: Evidence from augmented ARDL and nonlinear ARDL

Do Macroeconomic Variables Have a Symmetric or Asymmetric Effect on Non-Performing Loans? Evidence From Turkey

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