Adjustment of interbank lending in pre- and post-regulation periods: Empirical analysis of Vietnamese commercial banks
This article aims to analyze the interbank lending adjustment during the period when Vietnamese commercial banks are compliant with some parts of the Basel regulation framework. A pilot regulation period has started in 2011 and full application will be effective by the end of 2018. Partial adjustmen...
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| Format: | Article |
| Language: | English |
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Centre of Sociological Research, Szczecin, Poland
2017-10-01
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| Series: | Journal of International Studies |
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| Online Access: | http://jois.eu/?356,en_adjustment-of-interbank-lending-in-pre-and-post-regulation-periods-empirical-analysis-of-vietnamese-commercial-banks |
| Summary: | This article aims to analyze the interbank lending adjustment during the period when Vietnamese commercial banks are compliant with some parts of the Basel regulation framework. A pilot regulation period has started in 2011 and full application will be effective by the end of 2018. Partial adjustment models and variance decomposition are used for the analyses. In the analysis of the quarterly released financial statements of Vietnamese commercial banks in the period from 2008/Q1 to 2015/Q4, the empirical evidence showed that throughout the period, lending to non-bank and high liquidity assets contributed to the adjustment in both long run and short run with a negative association. In addition, the loan loss allowance contributed to the adjustment in the post-regulation period only with a positive association. These highly contributing factors also show a potential shock after the adjustment of the interbank lending. The results imply there is a need for interbank lending portfolio report and an efficient control over the IRB of Vietnamese commercial banks. |
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| ISSN: | 2071-8330 2306-3483 |