ABSTRACT This study carries out an empirical investigation of the determinants of banking sector development in Namibia. The study uses quarterly data for Namibia covering the period of 2000: I to 2011: IV, obtained from the Bank of Namibia. The indicator that is used to represent banking sector development is the ratio of credit extended to the private sector by the banks to gross domestic product (GDP). The study uses the autoregressive distributed lag model (ARDL) for the analysis. The bounds test for cointegration is used to test whether a long run relationship exists between the included variables. In addition, an ARDL framework is also used to test whether any of the included variables: real gross domestic product, nominal interest rates, inflation and the ratio of market capitalisation to nominal gross domestic product as a proxy of stock market development, impacts development in the banking sector. The main result from the study is that a long run relationship exists between the variables. Secondly, the estimated coefficients for the variables impacting banking sector development have expected signs. Real GDP, nominal interest rates positively influence banking sector development, while inflation is found to negatively impacts banking sector development. Stock market development is insignificant in determining banking sector development. The results suggest that developing the real sector without keeping interests rates too low could benefit the banking sector development.
SHIFOTOKA, M (2021). An Analysis Of Macroeconomic Determinants Of Banking Sector Development In Namibia. Afribary. Retrieved from https://track.afribary.com/works/an-analysis-of-macroeconomic-determinants-of-banking-sector-development-in-namibia
SHIFOTOKA, MARIA "An Analysis Of Macroeconomic Determinants Of Banking Sector Development In Namibia" Afribary. Afribary, 27 Apr. 2021, https://track.afribary.com/works/an-analysis-of-macroeconomic-determinants-of-banking-sector-development-in-namibia. Accessed 25 Nov. 2024.
SHIFOTOKA, MARIA . "An Analysis Of Macroeconomic Determinants Of Banking Sector Development In Namibia". Afribary, Afribary, 27 Apr. 2021. Web. 25 Nov. 2024. < https://track.afribary.com/works/an-analysis-of-macroeconomic-determinants-of-banking-sector-development-in-namibia >.
SHIFOTOKA, MARIA . "An Analysis Of Macroeconomic Determinants Of Banking Sector Development In Namibia" Afribary (2021). Accessed November 25, 2024. https://track.afribary.com/works/an-analysis-of-macroeconomic-determinants-of-banking-sector-development-in-namibia