Financial Liberalization as a Determinant of Banks’ Efficiency

Renata  Karkowska; Magdalena  Pruszyńska

doi:10.26354/bb.2.4.73.2018

Published : 2019-02-25

Vol. 73 No. 4 (2018)

Financial Liberalization as a Determinant of Banks’ Efficiency

Renata Karkowska

https://orcid.org/0000-0002-6335-2973

Magdalena Pruszyńska

https://orcid.org/0000-0002-6340-936X

DOI: https://doi.org/10.26354/bb.2.4.73.2018

Abstract

Contemporary pressures to enhance supervision and regulation of financial intermediation are aimed at increasing the efficiency of financial market functioning and the resilience of the global financial system to disturbances in its operation. The purpose of this paper is to evaluate the impact of financial liberalization on the banking sector efficiency. The analysis answers the following questions: Does financial liberalization affect changes in the banking sector cost/income ratio? How did the relationship between financial liberalization and European banks’ efficiency develop in 1995-2015? The research was conducted for 28 European countries between 1995 and 2015 divided into two periods: before the financial crisis (1995-2008) and after the crisis (2009-2015).

Keywords:

banking sector, financial liberalization, efficiency, ratio of costs to revenues

JEL Codes

G1, G21, G39, G32

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Karkowska, R. ., & Pruszyńska, M. . (2019). Financial Liberalization as a Determinant of Banks’ Efficiency. Safe Bank, 73(4), 27–41. https://doi.org/10.26354/bb.2.4.73.2018

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