Recent Credit Stagnation in the Mena Region : What to Expect? What Can Be Done?

Author/Editor:

Ralph Chami ; Raphael A Espinoza ; Adolfo Barajas ; Heiko Hesse

Publication Date:

September 1, 2010

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This paper examines the recent credit slowdown among Middle Eastern and North African (MENA) countries from three analytical angles. First, it finds that, similar to other regions and to its past history, a credit boom preceded the current slowdown, and that a protracted period of sluggish growth is likely going forward. Second, it uncovers a key role played by bank funding (deposit growth and external borrowing slowed considerably) but whose effect was frequently dampened by expansionary monetary policy. Third, bank-level fundamentals - capitalization and loan quality - helped to explain differences in credit growth across banks and countries.

Series:

Working Paper No. 10/219

Subject:

Frequency:

Quarterly

English

Publication Date:

September 1, 2010

ISBN/ISSN:

9781455208845/1018-5941

Stock No:

WPIEA2010219

Price:

$18.00 (Academic Rate:$18.00)

Format:

Paper

Pages:

19

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