A Segmentation Study of Non-Performing Loans Rates in Turkish Credit Market

13 Pages Posted: 24 Oct 2018

See all articles by Metin Vatansever

Metin Vatansever

Yildiz Technical University

Ibrahim Demir

Yildiz Technical University

Date Written: September 11, 2017

Abstract

Non-performing loans (NPLs) rate is one of the main risks in commercial banks and is also a critical measure of the bank’s financial performance and stability. Banks meet the growth rate of NPLs when the debtors are not able to meet their financial obligations in terms of repayment of loans. Regional diversification can impact NPLs rate as well as macroeconomic and bank-specific factors. The purpose of this study is to detect homogeneous credit risk groups by geographical locations. Diversification across regions can help banks and financial institutions to determine appropriate market areas and identify effective diversified investment strategies by reducing the overall risk of the credit portfolios.

Keywords: Time Series Clustering, Turkish Credit Market, Non–Performing Loan Ratios

JEL Classification: C22, G21, C38, C53, E17, E47, E60

Suggested Citation

Vatansever, Metin and Demir, Ibrahim, A Segmentation Study of Non-Performing Loans Rates in Turkish Credit Market (September 11, 2017). Available at SSRN: https://ssrn.com/abstract=3258424 or http://dx.doi.org/10.2139/ssrn.3258424

Metin Vatansever (Contact Author)

Yildiz Technical University ( email )

Davutpasa Mh., Esenler
Besiktas, Istanbul 80750
Turkey

Ibrahim Demir

Yildiz Technical University ( email )

Davutpasa Mh., Esenler
Besiktas, Istanbul 80750
Turkey

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
43
Abstract Views
343
PlumX Metrics