Hidden Bibliographic Details
| Varying Form of Title: | Nonperforming loans in the Gulf Cooperative Council banking system and their macroeconomic effects
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| Other authors / contributors: | Prasad, A., author.
International Monetary Fund. Middle East and Central Asia Department, issuing body.
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| ISBN: | 1283557657
9781283557658
9781455230488
1455230480
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| Notes: | Includes bibliographical references.
Print version record.
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| Summary: | According to a dynamic panel estimated over 1995 - 2008 on around 80 banks in the GCC region, the NPL ratio worsens as economic growth becomes lower and interest rates and risk aversion increase. Our model implies that the cumulative effect of macroeconomic shocks over a three year horizon is indeed large. Firm-specific factors related to risk-taking and efficiency are also related to future NPLs. The paper finally investigates the feedback effect of increasing NPLs on growth using a VAR model. According to the panel VAR, there could be a strong, albeit short-lived feedback effect from losses in banks' balance sheets on economic activity, with a semi-elasticity of around 0.4.
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| Other form: | Print version: Espinoza, Raphael A. Nonperforming Loans in the GCC Banking System and their Macroeconomic Effects. Washington : International Monetary Fund, ©2010 9781455208890
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