The Influence of Macroeconomic Trends on the Repayment of Loans by Households: Evidence from the Federation of Bosnia and Herzegovina and Policy Reccomendations

Pašić Sanela () and Omerbegović-Arapović Adisa ()
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Pašić Sanela: Candidate Senior Lecturer Department of Economics Sarajevo School of Science and Technology
Omerbegović-Arapović Adisa: Associate Professor Department of Economics Sarajevo School of Science and Technology

South East European Journal of Economics and Business, 2016, vol. 11, issue 1, 76-87

Abstract: This paper explores the influence of macroeconomic indicators, namely GDP growth, the Consumer Price Index and the unemployment rate on the quality of loan repayments by households in the banking market of the Federation of Bosnia and Herzegovina. Potential influence is observed over a period of fourteen years at the level of nonperforming household loans using regression analysis. The authors aim to determine whether macroeconomic forces actually influence loan repayment, and if so how and what can be done by banks to utilize this information in order to reduce future credit losses, and by the government to maintain the stability of the banking sector.

Keywords: influence of macroeconomic trends; nonperforming loans; Federation of Bosnia and Herzegovina (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:seejeb:v:11:y:2016:i:1:p:76-87:n:3

DOI: 10.1515/jeb-2016-0003

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