The Impact of Macroeconomic Variables and Bank-specific on Non-Performing Loans in Iranian Banks (By differentiating overdue receivables, deferred and doubtful)

Non-performing loans (overdue receivables, deferred and doubtful) is one of the effect of monetary activities. This phenomenon has negative effects on sources and usages of banks. Also, economic actors face with fluctuations of some variables of macroeconomics. This research investigates the impact of fluctuation of some macroeconomic variables on non-performing loans by differentiating overdue receivables, deferred and doubtful. Furthermore, this study used Bank-specific to stability results. In this way, dynamic panel applied for sample of 17 banks for 1384-1394 periods with Generalized Method Moments. In this study, the rate growth of non-oil GDP, the budget deficit, the free market nominal exchange rate, inflation and loan interest rate as independent variables and return on equity, solvency ratio, bank size and ownership of the bank as bank specific factors are used. The results showed that, the investigated bank specific factors include return on equity, debt ratio, bank size and ownership with Non-performing loans. Also, among macroeconomic factors, the loan interest rate of the facility has a positive effect on the increase in overdue receivables. Besides, increasing in the exchange rate has led to an increase in delayed and doubtful debts. Overall, the results indicate that bank-specific variables have a more effective effect on NPL’s than macroeconomic variables.