WHAT CAUSES NON-PERFORMING LOANS? EVIDENCE FROM THE ISLAMIC BANKING SECTOR OF BANGLADESH

This study aims to investigate the impact of bank-specific and macroeconomic factors on non-performing loans (NPLs), also known as irregular loans, in Islamic banks Bangladesh. The is crucial, NPL has become a growing concern for Bangladesh's banking sector, which affecting country's economy. data specific were collected from annual reports sample. In contrast, gathered World Development Indicators covering period 2007 2018. Different diagnostic tests, including correlations, heteroskedasticity, VIF (Variance Inflation Factor), run confirm that results OLS are accurate reliable. further runs fixed effect random models check robustness findings. findings indicate such loan growth, loan-to-asset ratio, net interest margin significantly reduce NPLs. Moreover, like GDP growth inflation influence NPLs under all models. While we divide samples into some sub-samples, found almost similar results, confirming suggest banks' management, regulatory bodies, other stakeholders have necessary initiatives how