Derivatives and Banking Lending Activities: Evidence from South Africa’s Banking Sector
Collin Chikwira (),
Rishidaw Balkaran () and
Veena Parboo Rawjee ()
Additional contact information
Collin Chikwira: Durban University of Technology
Rishidaw Balkaran: Cape Peninsula University of Technology
Veena Parboo Rawjee: Durban University of Technology
The Journal of Accounting and Management, 2021, issue 1(11), 207-219
The study explored the impact of derivatives usage and bank credit extension within the South African banking industry from 1996 through to the end of 2017. The system generalised method of moments (GMM) estimation technique with dynamic panel data model was used. The GMM is robust in controlling for endogeneity, unobserved heterogeneity, autocorrelation and dynamic panel bias. The study revealed that derivatives positively influence lending to both the private and public sectors in South Africa. It became evident that South African banks hedge credit risk, interest rate risk and cash flow risk in order to generate more revenue so that they can lend more.
Keywords: Derivatives market; intermediation; hedging; risk management (search for similar items in EconPapers)
References: Add references at CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:dug:jaccma:y:2021:i:1:p:207-219
Access Statistics for this article
More articles in The Journal of Accounting and Management from Danubius University of Galati Contact information at EDIRC.
Bibliographic data for series maintained by Florian Nuta ().