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Impact of Macro Factors on NPLs in the Banking Industry of Kazakhstan

Author

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  • Almas Kalimoldayev

    (Higher School of Economics and Business, Al-Farabi Kazakh National University, Almaty 050051, Kazakhstan
    JSC “The Fund of Problem Loans”, Almaty 050051, Kazakhstan)

  • Yelena Popova

    (Transport and Telecommunication Institute, Faculty of Management and Logistics, LV-1019 Riga, Latvia)

  • Olegs Cernisevs

    (SIA StarBridge, LV-1050 Riga, Latvia)

  • Sergejs Popovs

    (Institute of Life Sciences and Technologies, Daugavpils University, LV-5401 Daugavpils, Latvia)

Abstract

The importance of non-performing loans (NPLs) for the stability of financial sectors is difficult to overestimate. The NPL level depends on numerous factors; this study’s goal is to determine the impact of macroeconomic factors on NPLs with the mediation effect of foreign, saving and social factors in Kazakhstan’s banking sector. To determine the affecting factors, the authors performed a systematic literature review. To determine the dependencies between constructs, the Partial Least Squares Structural Equation Modeling (PLS-SEM) method was used. Macroeconomic factors’ direct effect on non-performing loans (NPLs) was examined; a significant negative dependence was determined. The mediation effect of foreign, saving, and social factors was investigated. Foreign factors have a mediation effect, strengthening the dependence between macro factors and NPLs. Nevertheless, they do not have a mediating effect; moreover, they balance and make the effect of macro factors on NPLs statistically insignificant. These findings allow policy-makers to stabilize the situation on NPLs in the financial markets of developing countries like Kazakhstan by directly influencing not only the financial sector but also other sectors of the national economy.

Suggested Citation

  • Almas Kalimoldayev & Yelena Popova & Olegs Cernisevs & Sergejs Popovs, 2025. "Impact of Macro Factors on NPLs in the Banking Industry of Kazakhstan," JRFM, MDPI, vol. 18(8), pages 1-21, August.
    • Handle: RePEc:gam:jjrfmx:v:18:y:2025:i:8:p:431-:d:1716153
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    References listed on IDEAS

    as
    1. Salvador Climent-Serrano, 2019. "Effects of economic variables on NPLs depending on the economic cycle," Empirical Economics, Springer, vol. 56(1), pages 325-340, January.
    2. Yelena Popova & Sergejs Popovs, 2022. "Impact of Smart Economy on Smart Areas and Mediation Effect of National Economy," Sustainability, MDPI, vol. 14(5), pages 1-19, February.
    3. Amer Mohamad & Hatice Jenkins, 2021. "Corruption and banks’ non-performing loans: empirical evidence from MENA countries," Macroeconomics and Finance in Emerging Market Economies, Taylor & Francis Journals, vol. 14(3), pages 308-321, September.
    4. Schlägel, Christopher & Sarstedt, Marko, 2016. "Assessing the measurement invariance of the four-dimensional cultural intelligence scale across countries: A composite model approach," European Management Journal, Elsevier, vol. 34(6), pages 633-649.
    5. Svetozar Tanasković & Maja Jandrić, 2015. "Macroeconomic and Institutional Determinants of Non-performing Loans," Journal of Central Banking Theory and Practice, Central bank of Montenegro, vol. 4(1), pages 47-62.
    6. Faaza Fakhrunnas & Rindang Nuri Isnaini Nugrohowati & Razali Haron & Mohammad Bekti Hendrie Anto, 2022. "The Determinants of Non-Performing Loans in the Indonesian Banking Industry: An Asymmetric Approach Before and During the Pandemic Crisis," SAGE Open, , vol. 12(2), pages 21582440221, June.
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