<abstract xmlns="http://www.w3.org/1999/xhtml"><p>The views regarding the role and the need for state development banks have evolved in the 20th century, from considering their role as very important in the 1950s, through the stance of their inadequacy and ineffectiveness, to a renewed interest for public development banks at the beginning of 21st century. In this study we will concentrate on the state development banks as an important instrument of state financial support to small and medium sized enterprises (SMEs). The Republic of Srpska Investment-Development Bank (RSIDB) provided the empirical context for our research. By applying the Mann-Whitney U Test and the correlation analysis the authors examined the effect of RSIDB loans on certain business performance indicators of SMEs. From the results of Mann-Whitney U Test it can be concluded that the average sales, number of employees and net profit in the five-year period after using the RSIDB loan is statistically significantly higher for the RSIDB borrowers compared to non-borrowers. The results of correlation analysis show that there is statistically significant positive correlation of medium strength between the use of RSIDB loans and the total sales, net profit and number of employees in the 5-year period after using the RSIDB loan. The study showed the positive impact of RSIDB loans on the growth of sales, net profit and employment of SME borrowers.</p></abstract>

The views regarding the role and the need for state development banks have evolved in the 20th century, from considering their role as very important in the 1950s, through the stance of their inadequacy and ineffectiveness, to a renewed interest for public development banks at the beginning of 21st century. In this study we will concentrate on the state development banks as an important instrument of state financial support to small and medium sized enterprises (SMEs). The Republic of Srpska Investment-Development Bank (RSIDB) provided the empirical context for our research. By applying the Mann-Whitney U Test and the correlation analysis the authors examined the effect of RSIDB loans on certain business performance indicators of SMEs. From the results of Mann-Whitney U Test it can be concluded that the average sales, number of employees and net profit in the five-year period after using the RSIDB loan is statistically significantly higher for the RSIDB borrowers compared to non-borrowers. The results of correlation analysis show that there is statistically significant positive correlation of medium strength between the use of RSIDB loans and the total sales, net profit and number of employees in the 5-year period after using the RSIDB loan. The study showed the positive impact of RSIDB loans on the growth of sales, net profit and employment of SME borrowers.

The Effects of State Development Banks on the Performance of Small and Medium Enterprises

Economic Themes

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

The views regarding the role and the need for state development banks have evolved in the 20th century, from considering their role as very important in the...

The Effects of State Development Banks on the Performance of Small and Medium Enterprises

Published Online: Sep 26, 2019

Page range: 389 - 411

Received: Aug 01, 2018

Accepted: Oct 09, 2018

DOI: https://doi.org/10.2478/ethemes-2018-0023

Keywords
state development banks, small and medium sized enterprises, business performance indicators, sales, profit, employment

© 2018 Jadranka Petrović, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

The Effects of State Development Banks on the Performance of Small and Medium Enterprises

Published Online: Sep 26, 2019

Page range: 389 - 411

Received: Aug 01, 2018

Accepted: Oct 09, 2018

DOI: https://doi.org/10.2478/ethemes-2018-0023

Keywordsstate development banks, small and medium sized enterprises, business performance indicators, sales, profit, employment

© 2018 Jadranka Petrović, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Keywords
state development banks, small and medium sized enterprises, business performance indicators, sales, profit, employment