The Effect of Recent Changes in Foreign Banks’ Behavior on Banking Sector Concentration – First Evidence from 53 Countries

Aneta Hryckiewicz-Gontarczyk; Joanna Wierusz-Wróbel

Opublikowane: 2023-11-21

Tom 59 Nr 2 (2015)

The Effect of Recent Changes in Foreign Banks’ Behavior on Banking Sector Concentration – First Evidence from 53 Countries

Aneta Hryckiewicz-Gontarczyk , Joanna Wierusz-Wróbel

Abstrakt

The aim of this paper is to assess the impact of foreign banks’ withdrawals on banking sector concentration. The past decade has been characterized by large scale foreign bank withdrawals from countries where these institutions represent a significant part of the banking sector. An empirical analysis has been conducted for the banking sectors of 53 countries over the period 1997 to 2008. The major finding is that the foreign banks’ withdrawals are positively correlated with banking concentration. The greatest magnitude of the effect can be seen with respect to the deposit market. Surprisingly, however, we do not notice any greater effect of acquisition of divested banks on banking sector concentration as compared to other forms of withdrawals. This might suggest a tendency to split up banking operations among many market players.

Pobierz pliki

PDF (English)

Zasady cytowania

Hryckiewicz-Gontarczyk, A., & Wierusz-Wróbel, J. (2023). The Effect of Recent Changes in Foreign Banks’ Behavior on Banking Sector Concentration – First Evidence from 53 Countries . Bezpieczny Bank, 59(2), 47–76. Pobrano z https://ojs.bfg.pl/index.php/bb/article/view/339

Licencja

Utwór dostępny jest na licencji Creative Commons Uznanie autorstwa – Użycie niekomercyjne – Na tych samych warunkach 4.0 Międzynarodowe.

Inne teksty tego samego autora

Aneta Hryckiewicz-Gontarczyk, Review of “Foreign capital and the impact of culture on bank management in Poland” , Bezpieczny Bank: Tom 65 Nr 4 (2016)

Bibliografia

Allen, F., Hryckiewicz, A., Kowalewski, O., & Tumer-Alkan, G. (2014): Transmission of bank liquidity shocks in loan and deposit markets: The role of interbank borrowing and market monitoring. Journal of Financial Stability, 15, 112–126.
Google Scholar

Angelini, P. & Cetorelli, N. (2003): The effects of regulatory reform on competition in the banking industry. Journal of Money, Credit and Banking, 35(5), 663–684.
Google Scholar

Beck, T., Demirguc-Kunt, A. (2006): Small and medium-size enterprises: Access to finance as a growth constraints. Journal of Banking and Finance, 30, 2931–2943.
Google Scholar

Bikker, J.A., & Haaf, K. (2002): Competition, concentration and their relationship: An empirical analysis of the banking industry. Journal of Banking & Finance, 26(11), 2191–2214.
Google Scholar

Bikker, J.A., & Spierdijk, L. (2009): Measuring and explaining competition in the financial sector. Tjalling C. Koopmans Research Institute Discussion Paper Series, 09-01.
Google Scholar

Carletti, E., Hartmann, P., & Spagnolo, G. (2002): Implications of the bank merger wave for competition and stability. In: Risk Measurement and Systemic Risk, Proceedings of the Third Joint Central Bank Research Conference (Board of Governors of the Federal Reserve System, Bank of Japan, European Central Bank), 38–50.
Google Scholar

Chortareas, G.E., & Garza-Garcia, J.G., & Girardone, C. (2011): Banking sector performance in Latin America: Market power versus efficiency. Review of Development Economics, 15(2), 307–325.
Google Scholar

Claessens, S., & Laeven, L. (2004): What drives bank competition? Some international evidence. Journal of Money, Credit and Banking, 36, 563–584.
Google Scholar

Claessens, S., van Horen, N., Gurcanlar, T., & Sapiain, J.M. (2008): Foreign bank presence in developing countries 1995–2006: Data and trends.” Mimeo, The World Bank, Washington, D.C.
Google Scholar

Claessens, S., & van Horen, N. (2012): Being a foreigner among domestic banks: Asset or liability? Journal of Banking & Finance, 36(5), 1276–1290.
Google Scholar

Clarke, G.R.G., Cull, R., Martinez Peria, M.S., & Sanchez, S.M. (2003): Foreign bank entry: Experience, implications for developing countries, and agenda for further research. World Bank Research Observer, 18(1), 25–59.
Google Scholar

Crystal, J.S., Dages, B.G., & Goldberg, L.S. (2002): Has foreign bank entry led to sounder banks in Latin America? Current Issues in Economics and Finance, 8, 1–6.
Google Scholar

De Haas, R., & van Lelyveld, I. (2003): Foreign bank penetration and private sector credit in Central and Eastern Europe. DNB Staff Reports (discontinued) 91, Netherlands Central Bank.
Google Scholar

De Haas, R., & van Lelyveld, I. (2010): Internal capital markets and lending by multinational bank subsidiaries. Journal of Financial Intermediation, 19(1), 1–25.
Google Scholar

Deloitte. (2014): Competition in retail banking. Deloitte Access Economics.
Google Scholar

Demirgüç-Kunt, A., & Huizinga, H. (2000): Determinants of commercial bank interest margins and profitability: Some international evidence, World Bank Economic Review, 13, 379–408.
Google Scholar

Demirgüç-Kunt, A., Laeven, L., & Levine, R. (2004): Regulations, market structure, institutions, and the cost of financial intermediation. Journal of Money, Credit, and Banking 36(3), 593–622.
Google Scholar

Efthyvoulou, G., & Yildirim, C. (2013): Market power in CEE banking sectors and the impact of the global financial crisis. Journal of Banking & Finance, 40, 11–27.
Google Scholar

Fernández de Guevara, J., Maudos, J., Pérez, F. (2005): Market power in European banking sectors. Journal of Financial Services Research, 27, 109–137.
Google Scholar

Gonzales, J. (2009): Determinants of bank market structure: Efficiency and political economy variables. Journal of Money, Credit and Banking, 41(4), 735–754.
Google Scholar

Hasan, I., Kowalewski, O., Kozłowski, Ł., Jackowicz, K., 2013: Market Discipline during Crisis: Evidence from Bank Depositors in Transition Countries, Journal of Baking and Finance, 37, 5436–5451.
Google Scholar

Hryckiewicz, A., & Kowalewski, O. (2011): Why do foreign banks withdraw from other nations? International Finance, 1, 67–102.
Google Scholar

Levine, R. (1996): Foreign banks, financial development, and economic growth. In Barfield, C.E., ed., International Financial Markets. Washington, D.C., AEI Press.
Google Scholar

OECD (2010): Competition, concentration and stability in the banking sector, available at http://www.oecd.org/regreform/sectors/46040053.pdf
Google Scholar

Pawlowska, M. (2012): Competition, concentration and foreign capital in the Polish banking sector (prior and during the financial crisis), National Bank of Poland Working Paper, 130, Warsaw.
Google Scholar

Rhoades, S.A. (2000): Bank mergers and banking structure in the United States, 1980–98. Board of Governors of the Federal Reserve System.
Google Scholar

Smirlock, M. (1985): Evidence on the (non) relationship between concentration and profitability in banking. Journal of Money, Credit, and Banking, 17, 69–83.
Google Scholar

Uhde, A. & Heimeshoff, U. (2009): Consolidation in banking and financial stability in Europe: Empirical evidence, Journal of Banking & Finance, vol. 33(7), s. 1299–1311, July.
Google Scholar

Weill, L. (2011): Bank competition in the EU: How has it evolved? Laboratoire de Recherche en Gestion et Economie Working Papers, No. 2011-04.
Google Scholar

Yeyati, E.L., & Micco, A. (2007): Concentration and foreign penetration in Latin American banking sectors: Impact on competition and risk. Journal of Banking & Finance, 31(6), 1633–1647
Google Scholar