Does Corruption Affect Non-Performing Loans in Central and Eastern Europe?
Abstract
Abstract The objective of this study is to examine the effect of corruption on non-performing loans in 17 Central and Eastern European countries from 2004 to 2021. The study investigates the influence of corruption on the incidence of non-performing loans while controlling for macroeconomic, bank-specific, and governance-related factors. The analysis is based on panel data, and the fixed effects method is applied. The results indicate that several variables, including corruption, unemployment, loan-to-deposit ratio, voice and accountability index, and credit growth significantly affect non-performing loans. The findings contribute to the existing literature by examining the role of external factors in the persistence of non-performing loans, revisiting this issue in the specific context of the Central and Eastern European region.
Fields of Study & Subjects
Corruption and Economic Development
Banking stability
regulation
efficiency
Economic Growth and Development
Publication details
- Journal / source
- Journal of Central Banking Theory and Practice
- Publisher
- Walter de Gruyter GmbH
- Volume
- 15
- Issue
- 1
- Pages
- 93–118
- Publication date
- 1 January 2026
- Language
- EN