摘要 :
The role that foreign banks play in developing countries has been arduously debated. Foreign banks can improve the efficiency of the banking sector in the host country but they can also undermine local banks by selecting only the ...
展开
The role that foreign banks play in developing countries has been arduously debated. Foreign banks can improve the efficiency of the banking sector in the host country but they can also undermine local banks by selecting only the most trustworthy borrowers. In this paper, I analyze the period between 2005 and 2014 and compare the differences between foreign and domestic banks in Mexico and Colombia. Analyzing Mexico is of great importance given that foreign banks control more than 80% of the banking assets. Also, given the difference in institutional development between Mexico and Colombia, I can control for regulatory environment. After controlling for size, institutional development, and country of origin, I find that foreign banks have not stimulated growth in Mexico through commercial loans. Previous studies suggest that this lack of credit to companies may be due to a weak enforcement of contracts rather than to foreign ownership. However, Colombia has a weaker enforcement of contracts environments and foreign banks also do not provide as many commercial loans as domestic banks. This paper is of particular interest to regulators in developing countries that need foreign capital and those that want to intensify the allocation of commercial credit.
收起
摘要 :
This paper provides a theoretical framework that can explain the empirical observation that foreign banks from industrialized countries tend to increase their involvement in emerging markets in periods of market instability. In th...
展开
This paper provides a theoretical framework that can explain the empirical observation that foreign banks from industrialized countries tend to increase their involvement in emerging markets in periods of market instability. In this model, domestic banks have (through past lending operations) more soft information on their borrowers available compared to foreign banks. Foreign banks, however, have a superior screening technology that allows them to obtain more hard information about their borrowers' investment projects. The model has an important implication: Foreign banks increase their market share when credit market conditions deteriorate. The rationale for this finding is that the comparative advantage of the domestic bank loses value in unstable credit market conditions. Thus, the advantage of having a screening technology becomes more important and allows the foreign bank to increase market share. In times of crisis hard information on projects is relatively more important than soft information on the borrower's history. Journal of Comparative Economics 39 (4) (2011) 486-498. HHL - Leipzig Graduate School of Management, Sparkassen-Finanzgruppe, Chair of Macroeconomics, Jahnallee 59, 04109 Leipzig, Germany; Bonn University, Department of Finance, Adenaueraliee 24-42, 53113 Bonn, Germany.
收起
摘要 :
A B S T R A C T The complex nature of an overall banking group could potentially affect the riskiness of their affiliates through various channels, such as agency costs and diversification gains. This paper empirically investi-gat...
展开
A B S T R A C T The complex nature of an overall banking group could potentially affect the riskiness of their affiliates through various channels, such as agency costs and diversification gains. This paper empirically investi-gates the effects of bank complexity of the global banks (in terms of their business activities and geo-graphical locations) on the riskiness of their affiliates, using a confidential data set of foreign bank af-filiates based in Hong Kong (FBHKs). Our empirical findings based on a panel regression model suggest that the complexity of global banks has significant effects on the riskiness of their foreign bank affil-iates, but the effects differ between the two complexity dimensions. Specifically, a FBHK from a more business complex banking group tend to have higher risks, and the effect is likely to be attributable to an intensified agency problem. For the geographical complexity, there is tentative evidence to support the presence of both diversification and agency problems. However, the average effect on the riskiness of FBHKs is found to be less clear-cut. To strengthen the identification, we further employ an alterna-tive difference-in-difference (DID) estimation approach. This approach exploits the exogenous decline in bank complexity of the parent group arising from the introduction of GSIB regulatory framework. The DID results are consistent with the findings identified from the panel regression model. (c) 2020 Elsevier B.V. All rights reserved.
收起
摘要 :
Presence of a heterogeneous banking system across countries provides opportunities for cross-border banks to indulge in activities of regulatory arbitrage. This article attempts to investigate whether regulatory arbitrage induces ...
展开
Presence of a heterogeneous banking system across countries provides opportunities for cross-border banks to indulge in activities of regulatory arbitrage. This article attempts to investigate whether regulatory arbitrage induces the presence of foreign banks in India. Using relevant country-level data on various aspects of banking regulations, we conduct a series of panel regressions to examine the effect of cross-country gap in banking regulations on foreign banks' presence in India. We find regulatory arbitrage as significantly determining foreign banks' presence in India, after controlling for other factors (income level of home country, bilateral economic relationship, colonial and linguistic commonality, and geographic proximity).
收起
摘要 :
This article uses data for 418 banks operating in Central and Eastern Europe between 1993 and 2004 to analyse the impact of the mode of foreign bank entry and of the parent institutions' characteristics on bank profitability. The ...
展开
This article uses data for 418 banks operating in Central and Eastern Europe between 1993 and 2004 to analyse the impact of the mode of foreign bank entry and of the parent institutions' characteristics on bank profitability. The results show that foreign banks are affected both less and differently by domestic economic conditions, but do react to the health of the parent banks and the economic situations in their home countries. Their mode of entry is important: profits of banks entering via greenfield investment exhibit a complementary relationship with their parent banks, whereas profits of banks acquiring domestic institutions are negatively related to the opportunity costs in their home markets.
收起
摘要 :
We study whether foreign banks engaged in countercyclical lending in the United States during the 1990-1991, 2001, and 2007-2009 recessions. Aggregate lending by foreign banks increased in the 1990-91 recession and by domestic ban...
展开
We study whether foreign banks engaged in countercyclical lending in the United States during the 1990-1991, 2001, and 2007-2009 recessions. Aggregate lending by foreign banks increased in the 1990-91 recession and by domestic banks in the 2001 recession. Controlling for local GDP and unemployment, we show countercyclical lending by foreign branches in the 1990 recession and by foreign subsidiaries in the 2001 recession. In the 2008 recession, foreign branches and subsidiaries exhibited neither countercyclical nor procyclical lending. We conclude that foreign banks like domestic banks respond to local economic conditions; the foreign ownership is not a factor.
收起
摘要 :
This article investigates how bank competition has evolved in Africa following the recent penetration and expansion of regional cross-border banks over the past decade. We examine changes in competition in the banking industry of ...
展开
This article investigates how bank competition has evolved in Africa following the recent penetration and expansion of regional cross-border banks over the past decade. We examine changes in competition in the banking industry of seven African countries highly affected by this recent phenomenon. The evolution of competition is evaluated through three different non-structural measures of competition (Lerner index, Panzar-Rosse model, and Boone indicator). With the exception of results from the Lerner index, our findings show an intensification of competition since the mid-2000s. This period corresponds to the rapid expansion of regional cross-border banks in the zone, indicating that this expansion has promoted competition in banking sectors in Africa.
收起
摘要 :
This paper examines the profitability of domestic and foreign banks before and during the recent financial crisis. Our sample covers 170 commercial banks operating in the French market over the period 2000–2012. We show that fore...
展开
This paper examines the profitability of domestic and foreign banks before and during the recent financial crisis. Our sample covers 170 commercial banks operating in the French market over the period 2000–2012. We show that foreign banks are more profitable than domestic banks, especially during the financial crisis. The robustness check analysis confirms this finding, especially for foreign banks from “advanced economies” compared to banks from “emerging economies”. We investigate the persistence of bank profitability. We find that, during the financial crisis, lagged profitability has a negative effect for domestic banks and a positive effect for foreign banks.
收起
摘要 :
Purpose - This paper aims to examine the role of foreign banks in transmitting global monetary policy shocks to India. Further, the authors try to explore the international bank lending channel and analyze the impact of global mon...
展开
Purpose - This paper aims to examine the role of foreign banks in transmitting global monetary policy shocks to India. Further, the authors try to explore the international bank lending channel and analyze the impact of global monetary policy on Indian macroeconomic variables.Design/methodology/approach - The authors use a structural break unit root test and structural vector autoregression on monthly data from 1998 to 2018.Findings - The study finds that the global monetary policy is significantly determining foreign banks' lending in India; the evidence of a portfolio re-balancing channel in the process of global monetary policy transmission to the Indian economy; the exchange rate is significantly explaining the foreign bank credit dynamism in India; and evidence of international monetary policy spillover to the Indian economy. Originality/value - This is the first attempt to analyze the role of foreign banks in the transmission of global monetary policy shocks to India, where the literature availability is limited. The finding of ineffective domestic monetary policy on foreign bank lending opens the need for an in-depth and diversified analysis of the role of foreign banks in the transmission of domestic monetary policy.
收起
摘要 :
This paper examines the determinants of foreign bank entry in South East Asian countries after significant policy changes following the regional financial crisis in 1997/1998. The results show that manufacturing FDI and bilateral ...
展开
This paper examines the determinants of foreign bank entry in South East Asian countries after significant policy changes following the regional financial crisis in 1997/1998. The results show that manufacturing FDI and bilateral trade exert weak impacts on the decision of entry by foreign banks, providing little evidence for the argument that banks follow their home customers abroad. In contrast, local profit opportunities appear to be the prominent factor attracting foreign bank penetration in South East Asia. The results are robust to different modelling techniques.
收起
