Purpose This study aims to examine the descriptive capabilities of efficiency, liquidity risk and capital risk for the cross-sectional and time-series variations in banks’ performance across emerging economies (EEs). It also examines the impact of the 2008 global financial crisis (GFC) on the effects of capital, liquidity and efficiency on banks’ performance. Design/methodology/approach The paper adopts a spatial panel model and collects data across 90 EEs. Findings The study shows that a surge in efficiency and liquidity improves bank performance. In addition, banks that finance credit creation primarily with core deposits perform better. Also, banks in EEs responded to the GFC. The findings show that banks in EEs respond to global events emanating from the developed economies. This indicates that EEs banks are relatively integrated with banks in developed markets. Originality/value Improvement in profit efficiency and effective liquidity and capital risk management enhance the performance of EEs banks.

PurposeThe study examines the dynamic association between competition, risk-taking, performance and income diversification of frontier and emerging economy (FEE) banks. It additionally, explores the effect of banking sector depth and economic performance on the level of competition, performance and risk-taking behavior of banks in these economies.Design/methodology/approachThe paper adopts a panel vector auto-regressive technique and collects data across ninety (90) FEEs.FindingsThe paper finds that competition increases with improvement in the depth of the banking sector, a surge in risk-taking behavior and the adoption of focused strategy by banks. Similarly, income diversification activities are driven by competition, banking sector depth, the state of the economy and bank performance. Additionally, risk-taking behavior, banking sector depth and the state of the economy are relevant in describing bank performance. Also, risk-taking behavior is influenced by bank performance, banking sector depth and economic growth.Originality/valueThe evidence indicates that although competition improves banking sector health, excessive competition and non-competitive banking environment constrain banks’ performance and stability.