Сorporate lending dynamics in Russian regions under the pandemic pressure: a new article by Polina Popova

A new article "COVID-19, corporate non-performing loans, and corporate lending dynamics: Evidence from Russian regions" by Polina Popova, research assistant at the LaBS, was published in the recent issue of Applied Econometrics.

Abstract:
The COVID‑19 pandemic had a highly negative impact on the corporate sector across many economies. This study examines the relationship between the spread of the COVID‑19 virus, the quality of corporate loan portfolios, and the volume of corporate loans in Russian re‑ gions. Using cross-regional variation in the number of COVID‑19 cases in Russia from April 2020 to February 2022, we document lower corporate loan portfolio quality among banks operating in regions with higher COVID‑19 rates, as well as an inverse relationship between corporate non-performing loans and the volume of corporate loans issued by Russian banks. We conclude that Russian banks adjusted their credit policy, observing a decrease in the quality of corporate loan portfolios. We also quantitatively analyze specific business support measures introduced in Russian regions during the COVID‑19 crisis.

Full text is available here.