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Impact of Nonresident Bank Loans on Economic Activity

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Global Economic Challenges

Part of the book series: Springer Proceedings in Business and Economics ((SPBE))

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Abstract

This study investigates the role of nonresident bank loans in economic activity. Analyses are conducted with GMM dynamic panel data techniques. The results show that nonresident bank loans have a statistically significant negative effect on economic activity. This finding is robust when controlling for banking sector development and stock market development indicators. The findings also show that while the stock market development indicator has a statistically significant positive effect on real per capita GDP, the banking sector development indicator has a statistically significant negative effect on economic activity, which may be explained by high amounts of debt and nonperforming loans in the sample countries. Results further show that inflation has a statistically significant negative effect on economic activity in all models.

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Authors and Affiliations

  1. Department of Business Administration, Middle East Technical University, Ankara, Turkey

    İlkay Şendeniz-Yüncü

Authors
  1. İlkay Şendeniz-Yüncü
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Correspondence to İlkay Şendeniz-Yüncü .

Editor information

Editors and Affiliations

  1. Department of Banking and Finance, Eastern Mediterranean University, Famagusta, Türkiye

    Nesrin Özataç

  2. Department of Finance and Banking, Ankara HBV University, Ankara, Türkiye

    Korhan K. Gökmenoğlu

  3. Department of Political Economy and Public Finance, University of Castilla-La Mancha, Cuenca, Spain

    Daniel Balsalobre Lorente

  4. Department of Banking and Finance, Eastern Mediterranean University, Famagusta, Türkiye

    Nigar Taşpınar

  5. Department of Banking and Finance, Rauf Denktas University, Nicosia, Türkiye

    Bezhan Rustamov

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Şendeniz-Yüncü, İ. (2023). Impact of Nonresident Bank Loans on Economic Activity. In: Özataç, N., Gökmenoğlu, K.K., Balsalobre Lorente, D., Taşpınar, N., Rustamov, B. (eds) Global Economic Challenges. Springer Proceedings in Business and Economics. Springer, Cham. https://doi.org/10.1007/978-3-031-23416-3_9

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