Affiliation:
1. Advisory Services Group, Governors Department, Central Bank of Nigeria, Abuja P.M.B. 0187, Nigeria
Abstract
Loan loss provision is an important accounting accrual in the banking sector. There have been numerous debates about the determinants of loan loss provision in several contexts. This study extends the debate by investigating the determinants of bank loan loss provision in non-crisis years for 28 countries from 2011 to 2018. The non-crisis years cover the periods after the global financial crisis and the periods before the COVID-19 pandemic while the countries consist of African, European, and Asian countries. Using the generalized linear model regression and the quantile regression methodologies, the results show that institutional quality is a significant determinant of bank loan loss provision, indicating that the presence of strong institutions decreases the size of bank loan loss provision in non-crisis years. In the regional analyses, it was found that economic growth is a significant determinant of bank loan loss provisions in African and Asian countries. Loan loss provision is higher in times of economic prosperity in African and Asian countries. Bank overhead cost is a significant determinant of bank loan loss provisions in Asian countries. Meanwhile, bank loan loss provision determinants are insignificant in European countries.
Reference30 articles.
1. Asymmetric loan loss provision models;Basu;Journal of Accounting and Economics,2020
2. Extraordinary items and income smoothing: A positive accounting approach;Beattie;Journal of Business Finance & Accounting,1994
3. Loan loss provisions and income smoothing in banks: The role of trade openness and IFRS in BRICS;Biswas;China Accounting and Finance Review,2024
4. Fair value exposure, auditor specialization, and banks’ discretionary use of the loan loss provision;Bratten;Journal of Accounting, Auditing & Finance,2020
5. Accounting discretion, loan loss provisioning, and discipline of banks’ risk-taking;Bushman;Journal of Accounting and Economics,2012
Cited by
1 articles.
订阅此论文施引文献
订阅此论文施引文献,注册后可以免费订阅5篇论文的施引文献,订阅后可以查看论文全部施引文献