A Study of Determinants and Their Impact on Bank Debt Restructuring in Indian Banks
DOI:
https://doi.org/10.17010/ijf/2021/v15i9/166318Keywords:
Bank Debt
, Bank Debt Restructuring, Corporate Debt Restructuring, Determinants, Fixed Effect Model, Hausman Test, Indian Public Sector Banks, Non-Performing Assets, Panel Data Modeling, Restructuring.JEL Classification
, B23, B26, C01, C22, C58, E22.Paper Submission Date
, February 20, 2020, Paper Sent Back for Revision, October 8, Paper Acceptance Date, April 15, 2021, Paper Published Online, September 25, 2021.Abstract
This research investigated the determinants and their impact on the bank debt restructuring in Indian banks, especially public sector banks, from 2008 – 2018. It analyzed the impact of gross advances and gross non-performing assets (NPAs) on the total number of restructured debts of the sampled banks. Panel data regression modeling was applied, where the Fixed Effect Model (FEM) was used as an estimation method. Granger causality test and Pearson correlation analysis were also employed. The results confirmed that gross NPAs and gross advances were highly statistically significant and positively impacted the total number of restructured loans at 5% and 1% significance levels, respectively. It was also confirmed that all the years jointly and each year individually had a significant time-fixed effect on the total number of restructured debts.Downloads
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