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

Samuel Fosu, Albert Danso, Henry Agyei-Boapeah, Collins G. Ntim, Emmanuel Adegbite

Research output: Contribution to journalArticlepeer-review

13 Citations (Scopus)

Abstract

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.

Original languageEnglish
Pages (from-to)55-103
Number of pages49
JournalReview of Quantitative Finance and Accounting
Volume55
Issue number1
DOIs
Publication statusPublished - Jul 1 2020
Externally publishedYes

Keywords

  • Banking market concentration
  • Credit information sharing
  • Developing countries
  • Governance quality

ASJC Scopus subject areas

  • Accounting
  • Business, Management and Accounting(all)
  • Finance

Fingerprint

Dive into the research topics of 'Credit information sharing and loan default in developing countries: the moderating effect of banking market concentration and national governance quality'. Together they form a unique fingerprint.

Cite this