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The Nexus Between Bank Credit Risk and Liquidity: Does the Covid-19 Pandemic Matter? A Case of the Oligopolistic Banking Sector

Author

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  • Magwedere Margaret Rutendo

    (Department of Finance, Risk Management and Banking, School of Economics and Financial Sciences, College of Economics and Management Sciences, University of South Africa, 1 Preller St, Muckleneuk, 0002, Pretoria. South Africa)

  • Marozva Godfrey

    (Department of Finance, Risk Management and Banking, School of Economics and Financial Sciences, College of Economics and Management Sciences, University of South Africa., 1 Preller St, Muckleneuk, 0002, Pretoria. South Africa)

Abstract

Background: There is a raging debate on how the COVID-19 pandemic disrupted the financial market environments, affected the banks’ strength as the credit channel, and the nexus between market liquidity and credit risk. During the COVID-19 crisis in the banking sector, credit risk and liquidity risk cannot be ignored as they have a considerable bearing on the performance and survival of banks.

Suggested Citation

  • Magwedere Margaret Rutendo & Marozva Godfrey, 2022. "The Nexus Between Bank Credit Risk and Liquidity: Does the Covid-19 Pandemic Matter? A Case of the Oligopolistic Banking Sector," Folia Oeconomica Stetinensia, Sciendo, vol. 22(1), pages 152-171, June.
    • Handle: RePEc:vrs:foeste:v:22:y:2022:i:1:p:152-171:n:2
    DOI: 10.2478/foli-2022-0008
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    References listed on IDEAS

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    More about this item

    Keywords

    Liquidity risk; Credit risk; COVID-19; banks; fixed effects. System GMM; financial conditions;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets

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