Determinants of non-performing loans in Namibia’s banking sector

Abstract

This thesis comprises of six chapters and investigates issues related to non-performing loans (NPL), a proxy for credit risk, with a particular focus on the banking sector of Namibia. The issues covered include a) assessing the evolution of Namibia’s financial system post-independence in 1990; b) determining the factors influencing the quality of Namibia’s loan portfolio; c) examining the causality between NPL and the identified factors; d) a stress-testing analysis examining the credit risk vulnerability of Namibia’s banking sector; and e) a forecast of the quality of Namibia’s banking sector loan portfolio. These five issues are interwoven and are subdivided into three main sets of objectives which are extensively explored in Chapters II, IV and V.