Does Financial Liberalization Lower Problem Loans in Banks?
Economic Notes, 2007, vol. 36, issue 2, 171-188
The paper explores whether financial liberalization promotes improved credit risk management in Indian banking in the form of fewer problem loans. Using annual data on state-owned banks for the period 1996-2005, the paper finds that, after controlling for a myriad of factors, financial liberalization is influential in lowering banks' problem loans. Robustness tests reinforce these findings. Copyright 2007 The Author Journal compilation 2007 Banca Monte dei Paschi di Siena SpA
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