The Exposure of Microfinance Institutions to Financial Risk

Thomas Gietzen

VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy from Verein für Socialpolitik / German Economic Association

Abstract: This study examines the exposure of microfinance institutions to liquidity, interest rate and foreign exchange (FX) risk. It builds on a manually collected set of data on the maturity structure of assets and liabilities of the 309 largest microfinance institutions (out of which 112 actually report the maturity structure). The data suggests that, on average, microfinance institutions in the sample face virtually no liquidity risk and that exposure to FX risk is lower than generally assumed. Linking risk exposure to institutional characteristics, I find that legal status and regional affiliation are correlated to risk exposure while regulatory quality is not.

JEL-codes: G21 G32 O16 (search for similar items in EconPapers)
Date: 2015
New Economics Papers: this item is included in nep-ban, nep-mfd and nep-rmg
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc15:112935

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