Author : Cheikh A. Gueye
Publisher : International Monetary Fund
ISBN 13 : 1498317790
Total Pages : 28 pages
Book Rating : 4.4/5 (983 download)
Book Synopsis Coping with Falling Oil Prices: The Different Fortunes of African Banks by : Cheikh A. Gueye
Download or read book Coping with Falling Oil Prices: The Different Fortunes of African Banks written by Cheikh A. Gueye and published by International Monetary Fund. This book was released on 2019-06-17 with total page 28 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper studies the impact of declining oil prices on banks in sub-Saharan African oil-exporting countries. Results indicate that banks respond differently to an oil shock depending on their ownership: (i) domestic banks are the most adversely impacted and experience a deterioration in asset quality and liquidity; (ii) foreign-owned banks are the most resilient as they are able to improve asset quality and attract deposits but at the same time, they decelerate credit growth; in contrast, (iii) Pan-African Banks help stabilize overall credit but large banks in that segment experience reduced asset quality. These differentiated results suggest a tradeoff between maintaining credit growth and safeguarding financial stability in an oil slump which could be addressed by both micro- and macroprudential policies.