165995 20260116163026.0 doi 10.2478/jeb-2025-0017 sideral 147449 ART-2026-147449 eng Troplini, Rovena Vangjel The dynamic Interplay between credit risk and monetary policy in Albania’s banking sector: a comprehensive analysis 2026 The study examines the relation between credit risk and monetary policy in Albania’s banking sector from 2015 to 2023, utilizing the Autoregressive Distributed Lag (ARDL) model. It analyzes post-crisis developments, particularly the Central Bank’s (CB) stabilization efforts and the write-off of NPLs. The findings show that higher CB rates increase NPLs in the short and long term. Following the 2008 financial crisis and the COVID pandemic, measures such as NPL write-offs and loan repayment postponements helped mitigate credit risk. Inflation contributed to credit stability by easing debt repayment burdens. Inflation and higher rates ease debt repayment and enhance credit stability. The Loan/Deposit Ratio influences NPLs, as managed decreases in LDR lower credit risk. Additionally, increased CB rates reduce new loan issuance, deterring high-risk borrowers and curbing NPL growth. The study highlights the effectiveness of Albania’s monetary policy in maintaining banking sector stability and supporting economic recovery. Access copy available to the general public Unrestricted info:eu-repo/semantics/openAccess by-nc-nd https://creativecommons.org/licenses/by-nc-nd/4.0/deed.es info:eu-repo/semantics/article info:eu-repo/semantics/publishedVersion Uku, Skënder Mamaqi Kapllani, Xhevrije Universidad de Zaragoza (orcid)0000-0002-4711-9792 4000 415 Universidad de Zaragoza Dpto. Análisis Económico Área Fund. Análisis Económico 20, 2 (2026), 34-52 South east Eur. j. econ. bus. South East European Journal of Economics and Business 1840-118X 1815714 http://zaguan.unizar.es/record/165995/files/texto_completo.pdf Versión publicada 2061899 http://zaguan.unizar.es/record/165995/files/texto_completo.jpg?subformat=icon icon Versión publicada oai:zaguan.unizar.es:165995 articulos driver 2026-01-16-14:54:28 ARTICLE