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The effects of systematic risks on bank asset quality : evidence from organisation of the petroleum exporting countries (OPEC)

The global position of Non-Performing Loans (NPLs) is persistent and on the rise which indicates a global deterioration of bank asset quality. The problem is more pronounced among the Organisation of the Petroleum Exporting Countries (OPEC) whose ratio of NPLs is on the verge of the banking crisis....

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Main Author: Idris, Isma'il Tijjani
Format: Thesis
Language:English
English
Published: 2017
Subjects:
HG Finance
Online Access:http://etd.uum.edu.my/7182/
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spelling my.uum.etd.71822021-05-09T03:45:21Z http://etd.uum.edu.my/7182/ The effects of systematic risks on bank asset quality : evidence from organisation of the petroleum exporting countries (OPEC) Idris, Isma'il Tijjani HG Finance The global position of Non-Performing Loans (NPLs) is persistent and on the rise which indicates a global deterioration of bank asset quality. The problem is more pronounced among the Organisation of the Petroleum Exporting Countries (OPEC) whose ratio of NPLs is on the verge of the banking crisis. The objective of this study is to investigate the effects of the prevalence of systematic risk factors in the OPEC countries on the deterioration of their bank asset quality. In achieving this objective, the study employed the panel data set of the entire OPEC countries spanning 1996-2015. Further, to account for NPL persistence, the study employed Pooled Mean Group (PMG) model in its estimations. The findings reveal that an increase in oil price improves bank asset quality which signifies that a rise in oil price inversely affects NPLs. On the other hand, a rise in the level of corruption increases the level of NPLs which indicates that corruption positively affects NPLs. Further, an increase in the level of political instability deteriorates the level of bank asset quality which means that an increase in the level of political instability positively affects NPLs. Additionally, the result reveals that an increase in environmental risks raises the level of NPLs which denotes that an increase in the occurrence of environmental risk positively affects NPLs. Overall, the findings imply that the prevalence of systematic risks in OPEC countries adversely affect bank asset quality and are key to financial stability. Consequently, the results imply that policymakers should design appropriate prudential policies that will curtail the impact of these systematic risks on bank asset quality and diversification of their economies which will ensure sustainable financial stability amongst OPEC countries. 2017 Thesis NonPeerReviewed text en /7182/1/s900557_01.pdf text en /7182/2/s900557_02.pdf Idris, Isma'il Tijjani (2017) The effects of systematic risks on bank asset quality : evidence from organisation of the petroleum exporting countries (OPEC). Doctoral thesis, Universiti Utara Malaysia.
institution Universiti Utara Malaysia
building UUM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Utara Malaysia
content_source UUM Electronic Theses
url_provider http://etd.uum.edu.my/
language English
English
topic HG Finance
spellingShingle HG Finance
Idris, Isma'il Tijjani
The effects of systematic risks on bank asset quality : evidence from organisation of the petroleum exporting countries (OPEC)
description The global position of Non-Performing Loans (NPLs) is persistent and on the rise which indicates a global deterioration of bank asset quality. The problem is more pronounced among the Organisation of the Petroleum Exporting Countries (OPEC) whose ratio of NPLs is on the verge of the banking crisis. The objective of this study is to investigate the effects of the prevalence of systematic risk factors in the OPEC countries on the deterioration of their bank asset quality. In achieving this objective, the study employed the panel data set of the entire OPEC countries spanning 1996-2015. Further, to account for NPL persistence, the study employed Pooled Mean Group (PMG) model in its estimations. The findings reveal that an increase in oil price improves bank asset quality which signifies that a rise in oil price inversely affects NPLs. On the other hand, a rise in the level of corruption increases the level of NPLs which indicates that corruption positively affects NPLs. Further, an increase in the level of political instability deteriorates the level of bank asset quality which means that an increase in the level of political instability positively affects NPLs. Additionally, the result reveals that an increase in environmental risks raises the level of NPLs which denotes that an increase in the occurrence of environmental risk positively affects NPLs. Overall, the findings imply that the prevalence of systematic risks in OPEC countries adversely affect bank asset quality and are key to financial stability. Consequently, the results imply that policymakers should design appropriate prudential policies that will curtail the impact of these systematic risks on bank asset quality and diversification of their economies which will ensure sustainable financial stability amongst OPEC countries.
format Thesis
author Idris, Isma'il Tijjani
author_facet Idris, Isma'il Tijjani
author_sort Idris, Isma'il Tijjani
title The effects of systematic risks on bank asset quality : evidence from organisation of the petroleum exporting countries (OPEC)
title_short The effects of systematic risks on bank asset quality : evidence from organisation of the petroleum exporting countries (OPEC)
title_full The effects of systematic risks on bank asset quality : evidence from organisation of the petroleum exporting countries (OPEC)
title_fullStr The effects of systematic risks on bank asset quality : evidence from organisation of the petroleum exporting countries (OPEC)
title_full_unstemmed The effects of systematic risks on bank asset quality : evidence from organisation of the petroleum exporting countries (OPEC)
title_sort effects of systematic risks on bank asset quality : evidence from organisation of the petroleum exporting countries (opec)
publishDate 2017
url http://etd.uum.edu.my/7182/
_version_ 1701165224443248640
score 13.211869

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