Time: 13:00-15:00 (UK Time), Wednesday, 6 December 2023
Presenter: Dr. Sandra Kendo, Catholic University of Lille, France
Chair: Prof. Victor Murinde, SOAS University of London
Online venue: Click here to join the seminar on Microsoft Teams (For any inquiry about how to join the online seminar, please contact Dr. Meng Xie at xm1@soas.ac.uk)

Abstract
Our research paper aims to analyze the financial risk sensitivity of the microfinance sector and investigate whether there is any link between concentration-stability nexus or concentration-fragility relationship. Additionally, we examine how the amount of funds, including deposits and borrowings, collected by microfinance institutions influences the concentration-stability or concentration-fragility link. We utilized a one-step estimator for the non-linear system GMM in comparison to GMM quantile regression on a dataset including 3114 microfinance institutions from 123 developing countries from 1999 to 2019. Our findings reveal a significant negative link between financial stability and market concentration, indicating strong evidence for concentration-fragility. Moreover, our results suggest that some heterogenous effects must be considered based on the degree of risk taken. We also found that microfinance institutions with access to high borrowing are more vulnerable with some significant heterogeneous effects. Furthermore, we demonstrate that microfinance institutions that collect fewer deposits are more financially fragile. Altogether, these findings have strong and plausible implications for policy and practice for the microfinance sector.

Presenter

Sandra Kendo is  Associate Professor in Monetary and Banking Economics at Catholic University of Lille, in France, where she is also in charge, as the Academic Advisor, of two training programs: a Bachelor's degree in Banking, Finance and Insurance and a Master’s degree in Banking and Finance. She is an active researcher under Group C (Finance and Resource Mobilisation) of the African Economic Research Consortium (AERC, Pan-African research institution, headquartered in Nairobi) and a member of the LITL Lab at the Catholic University of Lille. Her current research is on Impact Investing, Sustainable Finance, Financial Stability and Microfinance Market Concentration.