SYSTEMIC RISK’s effect ON THE STABILITY OF THE BANKING SECTOR: EVIDENCE FROM SAUDI ARABIA

Studies in economics and business relations Pub Date : 2024-01-05 DOI:10.48185/sebr.v4i2.954

M. A. Alshadadi, P. V. D. Deshmukh

{"title":"SYSTEMIC RISK’s effect ON THE STABILITY OF THE BANKING SECTOR: EVIDENCE FROM SAUDI ARABIA","authors":"M. A. Alshadadi, P. V. D. Deshmukh","doi":"10.48185/sebr.v4i2.954","DOIUrl":null,"url":null,"abstract":"The banking sectors are exposed to a lot of pressure due to the events taking place in the region, the most important of which is the decline in global oil prices and geopolitical events that led to political instability in the Middle East. This paper aims to study the macroeconomic variables that could be potential sources of systemic risks and to test their impact on the stability of the banking sector in the Kingdom of Saudi Arabia (1984-2020), using the ARDL approach of Co- integration and stability testing. In light of the economic theory and literature, systemic risks were identified by fluctuations in oil prices, interest rates, inflation and political instability as independent variables. The results showed a significant positive effect of oil prices and inflation on the banking sector's total assets and total deposits. In addition, the interest rate has a negative effect on total assets while positively affecting total deposits. Furthermore, political instability significantly affects the total assets of the banking sector during the Yemeni war, while there is insufficient evidence about its impact on total deposits.","PeriodicalId":498260,"journal":{"name":"Studies in economics and business relations","volume":"26 2","pages":""},"PeriodicalIF":0.0000,"publicationDate":"2024-01-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Studies in economics and business relations","FirstCategoryId":"0","ListUrlMain":"https://doi.org/10.48185/sebr.v4i2.954","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"","JCRName":"","Score":null,"Total":0}

引用次数: 0

Abstract

The banking sectors are exposed to a lot of pressure due to the events taking place in the region, the most important of which is the decline in global oil prices and geopolitical events that led to political instability in the Middle East. This paper aims to study the macroeconomic variables that could be potential sources of systemic risks and to test their impact on the stability of the banking sector in the Kingdom of Saudi Arabia (1984-2020), using the ARDL approach of Co- integration and stability testing. In light of the economic theory and literature, systemic risks were identified by fluctuations in oil prices, interest rates, inflation and political instability as independent variables. The results showed a significant positive effect of oil prices and inflation on the banking sector's total assets and total deposits. In addition, the interest rate has a negative effect on total assets while positively affecting total deposits. Furthermore, political instability significantly affects the total assets of the banking sector during the Yemeni war, while there is insufficient evidence about its impact on total deposits.

查看原文本刊更多论文

系统性风险对银行业稳定性的影响：沙特阿拉伯的证据

由于该地区发生的事件，银行业面临着很大的压力，其中最重要的是全球石油价格下跌和导致中东政治不稳定的地缘政治事件。本文旨在研究可能成为系统性风险潜在来源的宏观经济变量，并利用共同整合和稳定性检验的 ARDL 方法，检验这些变量对沙特阿拉伯王国银行业稳定性的影响（1984-2020 年）。根据经济理论和文献，系统性风险由石油价格波动、利率、通货膨胀和政治不稳定作为自变量确定。结果显示，油价和通货膨胀对银行业的总资产和存款总额有明显的正向影响。此外，利率对资产总额有负面影响，而对存款总额有正面影响。此外，在也门战争期间，政治不稳定对银行业的总资产有重大影响，而对存款总额的影响则证据不足。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

求助全文

约1分钟内获得全文求助全文

来源期刊

Studies in economics and business relations

自引率

0.00%

发文量