Factors Affecting Commercial Bank Loans for Small Businesses: Long-Term and Short-Term Econometric Analysis

In this article, the factors influencing the volume of loans allocated by commercial banks to small businesses are analyzed based on a long-term and short-term econometric approach. The study empirically assesses how internal indicators of the banking sector (capital volume, share of liquid assets, level of non-performing loans, volume of deposits) and macroeconomic factors (interest rate, inflation expectations) affect the dynamics of credit supply. The ARDL (Autoregressive Distributed Lag) and error correction mechanism (ECM) are used as a model, and the presence of a cointegration relationship between variables is checked. Although some factors have a significant impact on the loan amount in the short term, the degree of long-term dependence is not the same for all factors. In particular, bank liquidity and expansion of the deposit base act as a factor stimulating the supply of loans, but the long-term impact of interest rates and the level of non-performing loans is statistically unstable. The stability of the model is checked using the CUSUM test, and the possibility of short-term forecasting is substantiated. This research is of practical importance in terms of increasing the efficiency of financing small businesses, improving bank lending policy, and ensuring macroeconomic stability.