Factors Affecting Loan Loss Provisions of Vietnamese Commercial Banks: A Bayesian Approach

This study was conducted to determine the bank characteristics and macro factors affecting loan loss provision ratio (LLP) of commercial banks in Vietnam using the Bayesian regression method via the Gibbs sampling algorithm. The data in the study was collected from the financial statements of 26 Vietnamese commercial banks from 2013 to 2022. The study has found that the factors affecting the LLP of Vietnamese commercial banks are: bank size, non-performing loan ratio, profitability ratio, capital adequacy ratio (CAR), bank loan, credit growth, inflation rate, and GDP growth.