Current Issue : July-September Volume : 2023 Issue Number : 3 Articles : 5 Articles
Exchange rate fluctuation is considered in the literature as an essential driver of economic growth. This paper aims to investigate the impact of exchange rate fluctuation on economic growth of the Sierra Leone economy. As a whole, the period under consideration is a thirty-nine year period spanning from 1980 to 2018 inclusive. Previous researches show that there can be both positive and negative impact of exchange rate fluctuation on economic growth of a nation’s economy, and in this paper, we discovered that exchange rate fluctuation (depreciation of the Leones) has a positively significant relationship with economic growth in Sierra Leone. We used both ADF-test and PP-test to check for stationarity of the variables. The ordinary least square method was used to analyse data and results are based on regression analysis conducted from available data....
Risk management is what kind of strategies should be adopted to reduce all kinds of risk. Risk the difference between the actual return and the expected return. And credit risks the potential that borrower will fail to meet the obligation. The banking industry of Pakistan is faced with several challenges among them are determinants of credit risk and operational risk. Determinants of credit risk are defined as the factors that may affect the credit risk and determinants of operational risk are defined as the factors that affect the operation of business. Many banks in Pakistan have created credit risk management departments that are responsible for managing the credit risk associated with banking operation. The objective of this study is to evaluate the determinants of credit risk in Pakistani banking sector. The collected data consists of secondary data. Financial data was collected from three banks of Pakistan listed at Karachi stock exchange (KSE) over the period of 17 years from 2000 to 2016. Panel Regression Model was applied to find the cause and effect relationship for the under-consideration issue. The result has shown that credit risk and operational risk have a significant and positive relationship with NPLs, Gearing Ratio, and Operating Efficiency. And Credit Risk and operational risk have positive but insignificant relationship with Liquid Assets (LA). The recommendation of this study is if we pursue proper bank regulations, then the regulation should be backed up by sound credit analysis, and provision for suitable situation of credit loans....
Insurance in developing countries is not regarded as a main driver for economic growth as compared to other sectors such as infrastructure development and technology. However, insurance contributes to the national economies of many countries in a lot of ways such as employment creation, tax payment, investment, savings, and risk stabilisation amongst others. Insurance further alleviates government efforts in the provision of some amenities such as pension, improving lives of people, economic diversification, mitigating against risks and attracting Direct Foreign Investment (FDI) through risk stabilisation. The rate of insurance penetration in Africa is directly rated to the development and economic growth of a particular country. The systematic review aims to determine why there is a low uptake of insurance products in the Sub-Saharan Region using available, accessed, and published literature. The researcher conducted a systematic review in line with the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) reporting guidelines. The Google search engine, Google Scholar, the Cochrane Library and Scopus were searched for literature published. The evidence found, was arranged in a table format and thematic analysis. The findings indicate that poverty, lack of product knowledge, inadequate sensitization by the regulator and the low-income levels, were the main contributors to the low uptake of insurance products in Sub-Saharan Africa....
In recent years, the expansion of Fintech has speeded the development of the online peer-to-peer lending market, offering a huge opportunity for investment by directly connecting borrowers to lenders, without traditional financial intermediaries. This innovative approach is though accompanied by increasing default risk since the information asymmetry tends to rise with online businesses. This paper aimed to predict the probability of default of the borrower, using data from the LendingClub, the leading American online peer-to-peer lending platform. For this purpose, three machine learning methods were employed: logistic regression, random forest and neural network. Prior to the scoring models building, the LendingClub model was assessed, using the grades attributed to the borrowers in the dataset. The results indicated that the LendingClub model showed low performance with an AUC of 0.67, whereas the logistic regression (0.9), the random forest (0.9) and the neural network (0.93) displayed better predictive power. It stands out that the neural network classifier outperformed the other models with the highest AUC. No difference was noted in their respective accuracy value which was 0.9. Besides, in order to enhance their investment decision, investors might take into consideration the relationship between some variables and the likelihood of default. For instance, the higher the loan amounts, the higher the likelihood of default. The higher the debt to income, the higher the likelihood of default. While the higher the annual income, the lower the probability of default. The probability of default has a tendency to decline as the number of total open accounts rises....
According to the Wall Street Journal (Pellajaro, 2021), “Investors in search of higher returns and lower taxes are scooping up debt sold by state and local governments…” Municipal bonds (munis) total 39 billion dollars in 2021. Your investment portfolio should contain a basket of investments that include stocks and bonds. These are known as equity and fixed income instruments. A well-diversified portfolio minimizes your risk level and maximizes your growth potential over time. Such a portfolio should include the added protection of municipal bonds. That protection comes in the form of federal (and potentially state) tax exemptions. Municipal bonds offer fixed income opportunities that generate growth without federal tax burdens. This article aims to educate the layman on bonds and municipal bonds; specifically, how they work, how they are priced and how to add them to an investment and retirement portfolio....
Loading....