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Determinants of Bank Long-term Lending Behavior in the Central African Economic and Monetary Community (CEMAC)

Author

Listed:
  • Constant, Fouopi Djiogap

    (Faculty of Economics and Management, University of Yaounde II, Cameroon)

  • Augustin Ngomsi

    (Faculty of Economics and Management, University of Yaounde II, Cameroon)

Abstract

This paper studies the determinants of bank long-term loan in the Central African Economic and Monetary Community (CEMAC) context. The study aimed to test the common bank-level and macroeconomics determinants of bank long-term loan behavior. The model used is estimated using a sample of six countries from the CEMAC. We find that a bank¡¯s ability to extend long-term business loans depends on its size, capitalization, GDP growth and the availability of long term liabilities. These results underline the importance of supply side constraints in extending vital long-term credit to firms.

Suggested Citation

  • Constant, Fouopi Djiogap & Augustin Ngomsi, 2012. "Determinants of Bank Long-term Lending Behavior in the Central African Economic and Monetary Community (CEMAC)," Review of Economics & Finance, Better Advances Press, Canada, vol. 2, pages 107-114, May.
    • Handle: RePEc:bap:journl:120210
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    Cited by:

    1. Wang, Haibo & Sua, Lutfu & Dolar, Burak, 2023. "CAMELs-DEA in Assessing the Role of Major Factors in Achieving Higher Efficiency Levels: Evidence from Turkish Banks," SocArXiv qx59v, Center for Open Science.
    2. Misati, Roseline Nyakerario & Kamau, Anne, 2015. "Local and international dimensions to credit provision by commercial banks in Kenya," KBA Centre for Research on Financial Markets and Policy Working Paper Series 14, Kenya Bankers Association (KBA).
    3. Katuka, Blessing, 2017. "Credit risk dynamics in listed local banks in Zimbabwe (2009-2013)," MPRA Paper 92687, University Library of Munich, Germany, revised 2017.
    4. Zafer Adali & Bilgin Bari, 2017. "Monetary Policy And Bank Lending Chanel in Turkey," International Journal of Finance & Banking Studies, Center for the Strategic Studies in Business and Finance, vol. 6(2), pages 24-36, April.
    5. Seho, Mirzet & Alaaabed, Alaa & Masih, Mansur, 2016. "Risk-Sharing Financing of Islamic Banks: Better Shielded Against Interest Rate Risk?," MPRA Paper 82558, University Library of Munich, Germany.
    6. Ramic, Esma & Masih, Mansur, 2017. "Is islamic bank financing related to interest rate ? Malaysian evidence based on ARDL approach," MPRA Paper 107163, University Library of Munich, Germany.
    7. Dorsaf Elbir Merhbene, 2021. "The relationship between non-performing loans, banking system stability and economic activity: The case of Tunisia," IHEID Working Papers 03-2021, Economics Section, The Graduate Institute of International Studies.
    8. Shasnil Avinesh Chand & Ronald Ravinesh Kumar & Peter Josef Stauvermann, 2023. "Determinants of Non-Performing Loans in a Small Island Economy of Fiji: Accounting for COVID-19, Bank-Type, and Globalisation," JRFM, MDPI, vol. 16(10), pages 1-35, October.
    9. Albaity, Mohamed & Noman, Abu Hanifa Md. & Saadaoui Mallek, Ray & Al-Shboul, Mohammad, 2022. "Cyclicality of bank credit growth: Conventional vs Islamic banks in the GCC," Economic Systems, Elsevier, vol. 46(1).
    10. Alhassan, Abdul Latif & Owusu Brobbey, Freeman & Effah Asamoah, Michael, 2013. "Does Asset Quality Persist on Bank Lending Behaviour? Empirical Evidence from Ghana," MPRA Paper 48177, University Library of Munich, Germany.
    11. Serpil TOMAK, 2013. "Determinants of Commercial Banks’ lending Behavior: Evidence from Turkey," Asian Journal of Empirical Research, Asian Economic and Social Society, vol. 3(8), pages 933-943, August.
    12. Wang, Wei & Huang, Jun & Wang, Haibo & Alidaee, Bahram, 2022. "Internal and external analysis of community banks' performance," International Review of Financial Analysis, Elsevier, vol. 84(C).
    13. Alexander Ayertey Odonkor, 2018. "An Assessment of Credit Risk Management Practices of Adansi Rural Bank Limited," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 10(11), pages 110-110, November.
    14. Aneta Kosztowniak, 2022. "Credit Policy of Commercial Banks in EU and the Asset Quality of Non-Financial Corporate Loan Portfolio in 2009-2021," European Research Studies Journal, European Research Studies Journal, vol. 0(1), pages 563-582.
    15. Katuka, Blessing & Dzingirai, Canicio, 2015. "Micro and Macro Drivers of Credit Risk: The Case of Zimbabwean Banking Industry (2009-2013)," MPRA Paper 92688, University Library of Munich, Germany, revised 2018.
    16. Charles Adusei, 2018. "Determinants of Non-Performing Loans in the Banking Sector of Ghana Between 1998 and 2013," Asian Development Policy Review, Asian Economic and Social Society, vol. 6(3), pages 142-154, September.
    17. A. Olayiwola, John & M. Ajide, Folorunsho, 2019. "Do Oil Price and Institutional Quality Matter for Dividend Policy in Nigeria?," Working Papers 12, Department of Economics, University of Ilorin.
    18. Mwinlaaru, Peter Yeltulme & Ofori, Isaac Kwesi & Adiyiah, Kwadwo Agyeman & Idun, Anthony Adu-Asare, 2016. "Non-Performing Loans and Universal Bank’s Profitability," MPRA Paper 82902, University Library of Munich, Germany.

    More about this item

    Keywords

    Long-term business loans; CEMAC; Bank ¨Clevel determinants; GDP growth;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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