CBiBank Research Department: Non-Performing Loans and Country-Specific Risks

By Justin Douglas
Non-performing loans (NPLs) in the BRICS banking sectors are heavily influenced by country-specific risks. Factors such as economic stability, regulatory environments, and political risks play crucial roles. Studies have shown that micro-level factors like bank profitability and capital adequacy are significant determinants of NPLs. For instance, political instability in countries like Brazil and South Africa can lead to increased financial instability, impacting NPL levels. Effective risk management strategies and robust regulatory frameworks are essential for mitigating these risks and ensuring the stability of BRICS banking sectors.