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TitleAn investigation into the influence of credit ratings on credit risk of the South African banking industry
AuthorChoenyana, Kgapyane Samuel
SubjectCredit ratings
SubjectInformation asymmetry
SubjectCredit risk management
SubjectNon-performing loans
SubjectBank-specific variables and macro-economic
SubjectBanks and banking -- South Africa -- Credit ratings
SubjectBanks and banking -- South Africa
SubjectBank capital -- South Africa
SubjectRisk management
SubjectCredit -- Management -- South Africa
Format1 online resource (xi, 101 leaves) : illustrations (some color)
AbstractThe financial stability of banks is crucial if they are to fulfil their role in facilitating transactions between borrowers and lenders. The purpose of this study was to investigate the effect of credit risk on the South African banking industry following a movement in credit ratings by rating agencies. Data from a sample of 11 banks were collected from 2006 to 2015. Econometric regression analysis was used to analyse the data. The results show that inflation, credit ratings, exchange rate, gross domestic product, unemployment rate, capital adequacy ratio and size of the bank are significant factors that determine "non-performing loans". Therefore, it is imperative that banks continuously monitor these factors and adapt their credit policies on "non-performing loans". This action would prepare banks for any adverse effects and ensure that the banking industry remains a sound and efficient contributor to the growth of the South African economy.
AbstractBusiness Management
AbstractM. Com. (Business Management)