Determinants of non-performing loans: What do we know? A systematic review and avenues for future research

Florian Manz ()
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Florian Manz: Darmstadt University of Technology

Management Review Quarterly, 2019, vol. 69, issue 4, No 1, 389 pages

Abstract: Abstract This paper presents a systematic literature review of 44 studies on determinants of non-performing loans (NPL) published for the period 1987 to 2017 in 30 peer-reviewed journals. The motivation for this analysis is twofold. First, the NPL-issue is attributed high relevance by policy makers such as the European Central Bank and is currently addressed with a variety of measures. Any policy response requires deep understanding of the underlying determinants. Second, availability of data in the NPL-sector expanded, allowing scholars for more sophisticated research. Presenting novel interpretation, I synthesize the literature according to three broad, yet overlapping themes: macroeconomic events, bank- and loan-specific factors. Using an open coding process, the literature is diligently analyzed in 13 subcategories. The results reveal that the interaction of loan and asset specific events with macroeconomic and bank-specific factors still lacks a deep understanding and deserves for additional empirical research.

Keywords: Non-performing loans; Bad loans; Determinants; Literature review; Research topics; Research history (search for similar items in EconPapers)
JEL-codes: E50 G21 H81 N01 (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (21)

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DOI: 10.1007/s11301-019-00156-7

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