Determinants of Credit Growth and Interest Margins in the Philippines and Asia

WPIEA2012123 Image
Price:  $18.00

Author/Editor: Tatum Blaise Pua Tan
Release Date: © May, 2012
ISBN : 978-1-47550-352-4
Stock #: WPIEA2012123
English
Stock Status: On back-order

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Description

Despite robust deposit growth, credit growth has been sluggish in the Philippines. We attribute this to legacy weaknesses in bank balance sheets, consumption-led economic growth, and relatively high net interest margins. Bank-level analysis suggests that interest margins in the Philippines rise with bank size, bank capitalization, foreign ownership, overhead costs and tax rates. Using bank-level data for a number of Asian economies, we find that higher growth, lower inflation, higher reserve requirements, greater banking sector development, smaller stock market development and lower government deficits reduce net interest margins, informing the policy debate on strengthening financial intermediation in the Philippines.

Taxonomy

Economic sectors , Private sector




More publications in this series: Working Papers


More publications by: Tatum Blaise Pua Tan