Capital, funding liquidity, and bank lending in emerging economies: An application of the LSDVC approach

• Published in: Borsa Istanbul Review Vol. 19; no. 2; pp. 139 - 148
• Main Authors: Dahir, A.M., Mahat, F., Razak, N.H.A., Bany-Ariffin, A.N.
• Format: Journal Article
• Language: English
• Published: Elsevier B.V 01.06.2019; Elsevier
• Subjects: Bank lending; Capital; Funding liquidity; LSDVC; G20; Bank lending; G33; G21; G32; Capital; Funding liquidity; G28; C40; LSDVC

The paper examines the effect of funding liquidity on bank loan growth using a dynamic least squares dummy variable corrected (LSDVC) approach over the period between 2006 and 2015. The empirical results reveal that funding liquidity is negative and significant, which suggests that higher funding li...