Financial Liberalization, Bank Restructuring and the Implications for Non-Bank Intermediaries in the Financial Markets fo Africa: Lessons from the Gambia

Douglas H. Graham, Geetha Nagarajan and Korotoumou Quattara

No 198180, 1997 Occasional Paper Series No. 7 from International Association of Agricultural Economists

Abstract: Research on structural adjustment, liberalization and privatization in sub-Saharan Africa has not focused on the consequences of these policy initiatives on the financial sector. This paper documents and discusses the consequences of these reforms on the financial sector in The Gambia. Marked changes in the market structure and portfolio composition of the bank sector severely ration loan activity, particularly in rural areas. This creates a vacuum in which non-bank intermediaries currently operate with varying degrees of moral hazard and principal agent problems. The institutional design for non-bank intermediaries necessary to ensure a viable sustained supply of financial services for a rural clientele in Africa is discussed.

Keywords: Financial Economics; Public Economics (search for similar items in EconPapers)
Pages: 9
Date: 1997
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Persistent link: https://EconPapers.repec.org/RePEc:ags:iaaeo7:198180

DOI: 10.22004/ag.econ.198180

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