Effects of corruption on banking in sub-Saharan Africa (SSA)
DOI:
https://doi.org/10.18559/RIELF.2021.1.4Keywords:
Corruption, Bank credit, LoansAbstract
This paper analyses the effect of corruption on bank lending activity on a sample of 302 private banks from 25 countries in sub-Saharan Africa over the period 1995 to 2018. Using the generalized moments method, we find a negative effect of corruption on bank credit on the one hand, and a positive effect of corruption on non-performing loans on the other hand. This negative effect is empirically verified even if the heterogeneity linked to membership of a regional economic community in which integration is deep (ECOWAS) and membership of the CFA Franc zone is taken into account. These results suggest that anti-corruption policies are crucial in reducing the negative spillover effects generated by a poor institutional environment on access to bank lending and the quality of bank credit.(original abstract)
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Copyright (c) 2021 Poznań University of Economics and Business
This work is licensed under a Creative Commons Attribution 4.0 International License.
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