Determinants of non-performing loans in Namibia’s banking sector using composite indices

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dc.contributor.authorUndji, Valdemar J
dc.contributor.authorSheefeni, Johannes P.S.
dc.date.accessioned2026-01-26T06:53:56Z
dc.date.available2026-01-26T06:53:56Z
dc.date.issued2025
dc.description.abstractThis study investigates the determinants of non-performing loans (NPL) in Namibia’s banking sector using six composite indices (macroeconomic, bank-specific, monetary, interest rate, financial and institutional) spanning from 1996Q1 to 2021Q4. The Autoregressive Distributive Lag (ARDL) and pairwise Granger causality modelling approaches are respectively employed and the result shows that over the long-run, both the macroeconomic and interest rate index influence NPL. In the short-run, however, the study reveals that previous levels of NPL, macroeconomic, interest rate and institutional indices affect NPL altogether. In terms of causality, a long-run causal relationship is found between all the variables employed in the model. In the short-run, a unidirectional causal relationship running from the macroeconomic index to NPL and from NPL to the interest rate index as well as from NPL to the institutional index is registered. The study underscores some policy implications that are worth considering.
dc.identifier.citationUndji, V.J. and Sheefeni, J.P., 2025. Determinants of Non-performing Loans in Namibia’s Banking Sector Using Composite Indices. African Journal of Business and Economic Research, 20(1), p.391.
dc.identifier.urihttps://doi.org/10.31920/1750-4562/2025/v20n1a17
dc.identifier.urihttps://hdl.handle.net/10566/21830
dc.language.isoen
dc.publisherAdonis and Abbey Publishers Ltd
dc.subjectARDL
dc.subjectBanking sector
dc.subjectComposite indices
dc.subjectNamibia
dc.subjectNon-performing loans
dc.titleDeterminants of non-performing loans in Namibia’s banking sector using composite indices
dc.typeArticle

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