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Macroeconomic and Bank-specific determinants of Npls in Europe: the role of branches and bank size

Author

Listed:
  • Candida Bussoli

    (Università Lum Jean Monnet)

  • Vito Caputo

    (Università Lum Jean Monnet)

  • Danilo Conte

    (Università Lum Jean Monnet)

Abstract

The paper aims to test the impact of macroeconomic and microeconomic indicators on the quality of bank lending, based on a sample of 711 European banks with different specialisations, in the period 2013-2017. The evidences show that, on one side, adverse macro conditions worsen the quality of loans. On the other side, banks with higher profitability and capitalisation have a lower level of non-performing loans and loss reserves. Finally, the analysis indicates that more branches are negatively associated with credit quality, however their negative impact is reduced for larger banks

Suggested Citation

  • Candida Bussoli & Vito Caputo & Danilo Conte, 2020. "Macroeconomic and Bank-specific determinants of Npls in Europe: the role of branches and bank size," BANCARIA, Bancaria Editrice, vol. 1, pages 22-43, January.
    • Handle: RePEc:ban:bancar:v:1:y:2020:m:january:p:22-43
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    More about this item

    JEL classification:

    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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