One-step GMM

Two-step GMM

Coefficient

Robust SE

P-value

Coefficient

Robust SE

P-value

Constant/Intercept

7.331

4.950

Lagged log of bank loans

0.559

0.257

0.03**

0.65

0.182

0.000***

Macroeconomic Variables

Log of Real GDP

0.146

0.139

0.297

0.222

0.110

0.043**

Inflation

−0.003

0.002

0.135

−0.003

0.001

0.019**

Monetary Policy rate

−0.429

0.196

0.029**

−0.426

0.156

0.006***

Bank characteristics

Capitalization*MPR

−0.001

0.001

0.305

−0.0004

0.001

0.472

Size*MPR

0.024

0.011

0.034**

0.023

0.009

0.007***

Liquidity*MPR

−0.001

0.001

0.123

−0.001

0.0003

0.103

No of Banks

11

11

No of Observations

209

209

AR(1), P-value

0.023

0.025

AR(2), P-value

0.575

0.569

Sargan Test (p-value)

0.212

0.212