Macroeconomic Determinants of Non-Performing Loans in Bosnia and Herzegovina
Keywords:
non-performing loans, macroeconomic factors, banking sectorAbstract
The goal of this paper is to identify macroeconomic factors that affect non-performing loans in banking sector in Bosnia and Herzegovina. Starting point of the thesis is the assumption that four macroeconomic factors affect the quality of the banking sector’s loan portfolio. The annual data of the BiH Central Bank and Statistic Agency of BiH from 2006 to 2018 were used. The regression and correlation analyses’ results show that there is a correlation between non-performing loans and public debt rate. The influence of the real gross domestic product growth rate, the rate of inflation measured by the rate of consumer prices growth, and the unemployment rate are not statistically significant.
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