EconPapers    
Economics at your fingertips  
 

Asymmetric nonlinear analyses of banking sector behaviour, markets and interest rate risks in Africa's frontier economy

Augustine C. Arize, Ebere Ume Kalu, John Malindretos and Asli Ogunc

Afro-Asian Journal of Finance and Accounting, 2021, vol. 11, issue 4, 537-560

Abstract: With the possibility of a change in the narrative from the long-held linearity assumption to a nonlinearity and asymmetric discovery in the bank, market and the interest rate risk relationship, this paper explores the banks, stock market development and interest rate risk connection in the context of the Nigerian financial system. Empirical evidence arising from the study indicates that bank development exhibits interest rate sensitivity and changes in inverse direction with the interest rate. Moreover, the results strongly support asymmetry and nonlinearity in the relationship between bank development and stock market development. It is therefore recommended that policy efforts directed towards the development of the financial system should strike a balance between the linear/symmetric assumption and the nonlinear/asymmetric assumption.

Keywords: bank development; stock market development; asymmetries; linearity; nonlinearity; NARDL. (search for similar items in EconPapers)
Date: 2021
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.inderscience.com/link.php?id=117725 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ids:afasfa:v:11:y:2021:i:4:p:537-560

Access Statistics for this article

More articles in Afro-Asian Journal of Finance and Accounting from Inderscience Enterprises Ltd
Bibliographic data for series maintained by Sarah Parker ().

 
Page updated 2025-03-19
Handle: RePEc:ids:afasfa:v:11:y:2021:i:4:p:537-560