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Credit information sharing and loan default in developing countries: the moderating effect of banking market concentration and national governance quality

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posted on 2023-06-10, 03:29 authored by Samuel FosuSamuel Fosu, Albert Danso, Henry Agyei-Boapeah, Collins G Ntim, Emmanuel Adegbite
Departing from the existing literature, which associates credit information sharing with improved access to credit in advanced economies, we examine whether credit information sharing can also reduce loan default rate for banks domiciled in developing countries. Using a large dataset covering 879 unique banks from 87 developing countries from every continent, over a 9-year period (i.e., over 6300 observations), we uncover three new findings. First, we find that credit information sharing reduces loan default rate. Second, we show that the relationship between credit information sharing and loan default rate is conditional on banking market concentration. Third, our findings suggest that governance quality at the country level does not have a strong moderating role on the effect of credit information sharing on loan default rate.

History

Publication status

  • Published

File Version

  • Accepted version

Journal

Review of Quantitative Finance and Accounting

ISSN

0924-865X

Publisher

Springer

Volume

55

Page range

55-103

Department affiliated with

  • Accounting and Finance Publications

Full text available

  • Yes

Peer reviewed?

  • Yes

Legacy Posted Date

2022-05-11

First Open Access (FOA) Date

2022-05-11

First Compliant Deposit (FCD) Date

2022-05-11

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