June 1, 2018 Thesis Open Access

ELIAS TIRIT

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@misc{elias_tirit_2018_1949,
  author       = {ELIAS TIRIT},
  title        = {{The study focuses on the investigation of the 
                   macro factors that affect the development of the
                   banking sector. Because, The banking sector is
                   rudimentary due to the problems such asheavy
                   dependence of investors in borrowed fund,
                   excessive government borrowing, absence of
                   secondary markets, less attractive deposit rate,
                   limited outreach of banking services,
                   underdeveloped saving culture, poor cross-selling
                   activity of inflow of foreign remittance, deficit
                   in the trade balance of the country. The purpose
                   of this study is, therefore, to investigate the
                   significant determinants and recommend courses of
                   action to be taken and analyze the level of
                   development in comparison to other East African
                   countries. Quantitative research approach is
                   applied using econometric model estimated OLS
                   multiple linear regression and descriptive
                   quantitative analysis technique. The study has
                   found that Trade Openness, Real Interest rate,
                   population growth, and Government consumption
                   expenditure have far reaching statistically
                   significant impact on the development of the
                   banking sector by influencing the volume of credit
                   provided by banks to the private sector.
                   Remittance to GDP ratio, Real Interest Rate and
                   GDP growth rate significantly impact the broad
                   money supply (M2). There is also significant
                   concentration of asset of the sector in three big
                   banks and the Level of liquid asset to total
                   deposit is lower than the East African countries
                   though NPL is the least. The paper recommends
                   strengthening of the trade balance \& openness, cut
                   budgetary deficit, increase the real interest
                   rate, cross-selling of inflow of remittance by
                   banks and the NBE shall take measures that enhance
                   financial inclusion and improve the platform of
                   required infrastructure in collaboration with the
                   designated organs of the government to enhance
                   development and competitiveness of the banking
                   sector.}},
  month        = jun,
  year         = 2018,
  publisher    = {National Academic Digital Repository of Ethiopia},
  doi          = {10.20372/nadre:1949},
  url          = {https://doi.org/10.20372/nadre:1949}
}