Investigation of the effect of macroeconomic and bank-specific factors on non-following loans of private deposit banks

The non-performing loans ratio, which is reached by the ratio of non-performing loans and all loans, is a critical tool for measuring the performance of a bank. In this study, which was conducted to examine the relationship between macroeconomic indicators and bank-specific factors, the rate of non-performing loans, gross domestic product growth rate, inflation and unemployment were macroeconomic variables; return on assets, loan growth rate and net interest margin are taken as in-bank factors. The dependent variable of the model is the non-performing loans ratio, and privately owned deposit banks operating between 2010-2019 were included in the research. According to the results of the analysis using the generalized moments method, there is a negative relationship between the gross domestic product growth rate and the non-performing loans ratio, and a positive relationship between inflation and unemployment rates and gross domestic product growth rate; A negative relationship was also found between return on assets ratio, net interest margin, loan growth rate and gross domestic product growth rate.