The high volume of non-performing loans and its trend over time is one of the main problems of banks and central banking in Iran. This high volume of non-current receivables and the destructive effects that this phenomenon has, has made it very important to identify and examine the role of the factors affecting it. In the present study, determinant factors from the Borrower, lender and regional economic factors affecting the non-performing loans of the country's banking network for four banking groups: commercial government, specialized government, privatized and private in 31 provinces of Iran for the years 1385-1398 has been studied. The regional dimension in the analysis of non-performing loans is the distinguishing feature of this study from similar studies that have been questioned by the authors of the article. In a geographical area, economically, the most important aspect of appearance is the density of population and the agglomeration of industrial activities, which has arisen due to the agglomeration economies, and with its expansion, the production costs of the enterprise are reduced. Therefore, the enterprises that can benefit the most from these agglomeration economies are expected to be more successful in repaying bank loans. For this purpose, data on non-performing loans, payment facilities and bank deposits for all provinces of Iran were mentioned separately for the four banking groups and data on other related variables were collected provincially. The industrial agglomeration index was also calculated using the Gorter-kok equation for the provinces of Iran. Then, using the econometric technique, the fixed effects of unbalanced panel data were determined more payment facilities, more bank deposits and higher unemployment rate cause a significant increase in non-performing loans, while higher inflation and higher industrial agglomeration reduce non-performing loans. The clearer conclusion is that the size of industrial agglomeration has a negative effect on the size of non-performing loans. These findings suggest that stress tests designed to measure the quality of banks' payment facilities and probability of default of borrowers, in addition to the capital adequacy and credit quality of banks, should also consider the impact of regional economic conditions on non-performing loans.