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Macroeconomic Determinants Of Non-Performing Loans Of Dmbs In Sub-Saharan Africa Countries

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  • OSAZEE GODWIN OMOROKUNWA
  • OSABO MICHAEL EMOVON

Abstract

This study focused on the determinant of macroeconomic variables on the non-performing loans of banks in the sub-Saharan African region using the fixed effect panel regression method. Data from twenty-two SSA countries from 2010 to 2021 were used. The results from the study provide a general indication that the macroeconomic environment matters a lot for non-performing loans within the banking sectors of SSA countries. It is therefore recommended that banks in the SSA sub-region learn to develop adaptive mechanisms to address the effects of macroeconomic shocks on their loan policy. These measures may come in the form of well-diversified portfolio systems that will improve banks' hedging.

Suggested Citation

  • Osazee Godwin Omorokunwa & Osabo Michael Emovon, 2024. "Macroeconomic Determinants Of Non-Performing Loans Of Dmbs In Sub-Saharan Africa Countries," Journal of Academic Research in Economics, Spiru Haret University, Faculty of Accounting and Financial Management Constanta, vol. 16(2 (July)), pages 444-461.
    • Handle: RePEc:shc:jaresh:v:16:y:2024:i:2:p:444-461
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    Keywords

    Macroeconomic variables; Non-Performing Loans; Institutional factors; Deposit Money Banks; Sub-Saharan Africa.;
    All these keywords.

    JEL classification:

    • E02 - Macroeconomics and Monetary Economics - - General - - - Institutions and the Macroeconomy
    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • N27 - Economic History - - Financial Markets and Institutions - - - Africa; Oceania

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