Does leverage fit non-performing loans in the COVID-19 pandemic – evidence from the Vietnamese banking system

Nguyen Kim Quoc Trung

Cogent Business & Management, 2022, vol. 9, issue 1, 2119675

Abstract: The study aims to estimate the effect of leverage on non-performing loans in Vietnamese commercial banks from 2010 to 2020. This article uses qualitative (expert interviews, namely senior credit officers’ and credit managers’ surveys to find out the expert consensus coefficient) and quantitative research methods (Generalized Method of Moments to solve the endogeneity). The findings show that leverage is a statistically significant factor and negatively affects non-performing loans. In line with corporate governance theories, such as agency theory and stakeholder theory, this study emphasizes the significant role of the leverage ratio in dealing with non-performing loans at commercial banks in Vietnam during the COVID-19 pandemic. Besides, the study also highlights effective mechanisms to control and mitigate non-performing loans in the credit granting process.

Date: 2022
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/23311975.2022.2119675 (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:taf:oabmxx:v:9:y:2022:i:1:p:2119675

Ordering information: This journal article can be ordered from
http://cogentoa.tandfonline.com/journal/OABM20

DOI: 10.1080/23311975.2022.2119675

Access Statistics for this article

Cogent Business & Management is currently edited by Len Tiu Wright and Tahir Nisar

More articles in Cogent Business & Management from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().