01749cas a2200241 a 4500 AALejournalIMF007296 230101c9999 xx r poo 0 0eng d 5.00 USD 9781455297740 1018-5941 BD-DhAAL BD-DhAAL Nkusu, Mwanza. Nonperforming Loans and Macrofinancial Vulnerabilities in Advanced Economies / Mwanza Nkusu. Washington, D.C. : International Monetary Fund, 2011. 1 online resource (27 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students We analyze the link between nonperforming loans (NPL) and macroeconomic performance using two complementary approaches. First, we investigate the macroeconomic determinants of NPL in panel regressions and confirm that adverse macroeconomic developments are associated with rising NPL. Second, we investigate the feedback between NPL and its macroeconomic determinants in a panel vector autoregressive (PVAR) model. The impulse response functions (IRFs) attribute to NPL a central role in the linkages between credit market frictions and macrofinancial vulnerability. They suggest that a sharp increase in NPL triggers long-lived tailwinds that cripple macroeconomic performance from several fronts. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2011/161 Full text available on IMF http://elibrary.imf.org/view/journals/001/2011/161/001.2011.issue-161-en.xml IMF e-Library