Impact of the recapitalization of the banking system on Mozambique's economic growth: a comparative and correlational analysis of banking indicators: the case of Moza Banco (2014-2020)
Keywords:
Bank Recapitalization, Economic Growth, Mozambique, and Financial Stability.Abstract
This doctoral thesis investigates the impact of bank recapitalization on Mozambique’s economic growth, using Moza Banco during the 2014–2020 period as a paradigmatic case. The study confronts the methodological challenge of a short time series (n=7 years), which precludes the use of conventional econometric techniques. In response, it adopts a robust methodological triangulation strategy, combining advanced descriptive analysis, a quasi-experimental pre-post comparative research design, and exploratory multivariate correlation analysis. This approach ensured inferential validity and analytical transparency, prioritizing methodological appropriateness over inadequate statistical sophistication. The research draws on official secondary data, operationalizing microprudential variables (Moza Banco’s Tier 1 Capital, Total Tier 1 Capital, Solvency Ratio), a macroeconomic variable (GDP Growth Rate), a financial system variable (Private Sector Credit/GDP), and market structure variables (Herfindahl-Hirschman Indices). The findings reveal an acute crisis in 2016, characterized by the technical insolvency of Moza Banco (solvency ratio close to –100%) and a concomitant economic recession. Comparative analysis demonstrates that the recapitalization (2016/2017) had a direct, immediate, and pronounced microprudential impact. The bank’s capital and solvency indicators exhibited a V-shaped recovery, moving from near-failure levels to robust soundness in the post-intervention period. Simultaneously, deposit concentration indices, which had risen sharply during the crisis, signaling a “flight to safety”, began to normalize, indicating restored confidence and the intervention’s effectiveness in containing systemic contagion.
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