Template-Type: ReDIF-Article 1.0
Author-Name: Peterson K. Ozili
Author-Email: pkozili@cbn.gov.ng
Title: Elections and bank non-performing loans: Evidence from developed countries
Abstract: The existing literature has not examined how elections affect bank non-performing loans and its determinants even though banks are often the largest borrowers to fund election campaigns in many countries. This study investigates the determinants of bank non-performing loans (NPL) during election years in 35 developed countries. The fixed effect regression methodology was used to estimate the determinants of bank non-performing loans during election years. It was found that the banking sector experienced high NPLs during election years. Efficient banks operating in robust legal environments have higher non-performing loans during election years. It was also found that capital adequacy ratio, real GDP growth, loan-to-GDP ratio, cost-to-income ratio, political stability, and absence of terrorism are significant determinants of bank non-performing loans. The findings imply that election matters for the persistence of bank non-performing loans in developed countries.  
Keywords: non-performing loan, bank performance, election, banks, credit risk, efficiency, capital adequacy ratio, GDP growth, political stability
Journal: Modern Finance
Pages: 63-79
Volume: 2
Issue: 2
Year: 2024
Subtitle : 
File-URL: https://mf-journal.com/article/view/175
File-Format: text/xml
Handle: RePEc:bdy:modfin:v:2:y:2024:i:2:p:63-79:id:175