Browsing by Author "Alhassan, A.L."
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Item Asset quality in a crisis period: An empirical examination of Ghanaian banks(Elsevier - Science Direct (Review of Development Finance), 2014-03-08) Alhassan, A.L.; Kyereboah-Coleman, A.; Andoh, C.This paper examines the factors that account for the deterioration in the asset quality of Ghanaian banks during a period of financial crises usinga unique dataset on 25 banks from 2005 to 2010. Based on system Generalized Method of Moments estimations, we find that the persistence ofnon-performing loans in addition to loan growth, bank market structure, bank size, inflation, real exchange rate and GDP growth are the significantdeterminants of banks asset quality in Ghana. The findings have implications for both bank management and regulators in emerging economies.Item Insurance regulations, risk and performance in Ghana(Journal of Financial Regulation and Compliance, 2019-08-09) Kusi, B.A.; Alhassan, A.L.; Ofori-Sasu, D.; Sai, R.Purpose – This study aims to examine the hypothesis that the effect of insurer risks on profitability is conditional on regulation, using two main regulatory directives in the Ghanaian insurance market as a case study. Design/methodology/approach – This study used the robust ordinary least square and random effect techniques in a panel data of 30 insurers from 2009 to 2015 to test the research hypothesis. Findings – The results suggest that regulations on no credit premium and required capital have insignificant effects on profitability of insurers. On the contrary, this study documents evidence that both policies mitigate the effect of underwriting risk on profitability and suggests that regulations significantly mitigate the negative effect of underwriting risk to improve profitability. Practical implications – The finding suggests that policymakers and regulators must continue to initiate, design and model regulations such that they help tame risk to improve the performance of insurers in Ghana. Originality/value – This study provides first-time evidence on the role of regulations in controlling risks in a developing insurance market.Item Insurance-growth nexus in Ghana: An autoregressive distributed lag boundscointegration approach(Elsevier - Science Direct (Review of Development Finance), 2014) Alhassan, A.L.; Fiador, V.This paper examines the long-run causal relationship between insurance penetration and economic growth in Ghana from 1990 to 2010. Usingthe autoregressive distributed lag (ARDL) bounds approach to cointegration by Pesaran et al. (1996, 2001), the study finds a long-run positiverelationship between insurance penetration and economic growth which implies that funds mobilized from insurance business have a long run impacton economic growth. A unidirectional causality was found to run from aggregate insurance penetration, life and non-life insurance penetration toeconomic growth to support the ‘supply-leading’ hypothesis. The findings have implications for insurance market development in Ghana.Item Market structure, efficiency and profitability of insurance companies in Ghana(International Journal of Emerging Markets, 2015-09) Alhassan, A.L.; Addisson, G.K.; Asamoah, M.E.Purpose – The purpose of this paper is to examine the impact of the regulatory-driven market structure on firm pricing behaviour by testing the structure-conduct-performance (S-C-P) hypothesis for both life and non-life insurance markets in Ghana. Design/methodology/approach – Using a panel data on 14 life and 22 non-life insurers from 2007 to 2011, the authors employed the Herfindahl Hirschman Index and concentration ratio as proxies for the S-C-P hypothesis while efficiency scores were estimated using the data envelopment analysis technique to proxy for the efficient structure (ES) hypothesis. The dependent variable, profitability was measured as return on assets while controlling for size, underwriting risk, leverage, GDP growth rate and inflation. The models were estimated using the panel corrected standard errors of Beck and Katz (1995) and random effects estimations. Findings – The results from the empirical estimation provide ample evidence in support for ES hypothesis for both life and non-life insurance markets. While conflicting results was found for SCP hypothesis in the non-life insurance market, it was rejected in the life insurance market. The findings also point to an increasing level of competition in both life and non-life insurance industry in Ghana though they still remain concentrated with the life insurance sector having high levels of efficiency compared to the non-life sector. Practical implications – The findings of the study will enhance the understanding of firm behaviour in the new markets created to shape regulatory and competition policies of the regulator to promote consumer welfare while ensuring a stable industry to enhance its role in economic development. Originality/value – This is the first study to test the market power and efficient hypotheses on the insurance industry in Ghana. To the best of the author’s knowledge, this study is the first to examine the determinants of profitability in the non-life insurance market. © 2015, Emerald Group Publishing Limited.