The Impacts of Non-Performing Loans upon the Prices of Stocks in Jordanian Commercial Banks

Abstract

The purpose of this study can be seen through the major attention that was given to the problem of non-performing loans by the banking institutions. Such attention was given to this problem due to the several impacts it has upon commercial banks and which may extend to affect the whole banking system, the current study aimed at identifying whether there is a statistically significant impact for the non - performing loans upon the prices of stocks or not in Jordanian commercial banks at the significance level of (a = 0.05). This study was concerned with investigating the Jordanian commercial banking sector during the period of (2005 –2015). The current study has given great attention to this sector because it is considered as the most vital sector in the Jordanian economic system. This study also shows that there is need for training workers in applying the credit policy that is being adopted. Such training should raise the practical efficiency levels of those employees. The study also showed that banks’ control should be stricter and they should set more dissuasive penalties in relation to granting facilities without having adequate guarantees.