Consolidation and commercial bank net interest margins: Evidence from the old and new European Union members and candidate countries

Kasman, Adnan; Tunç, Gökçe; Vardar, Gülin; Okan, Berna

doi:10.1016/j.econmod.2010.01.004

Cited by 142 publications

(147 citation statements)

References 16 publications

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“…As noted by Kasman et al (2010), the new EU member countries embarked on large-scale privatisation programmes in the mid-1990s in order to boost banking competition and efficiency. As a result, bank consolidation among the Central and Eastern European (CEE) countries peaked in the 2000s and the countries' banking systems are now more viable and efficient (Kasman et al, 2010). Hence a higher level of competition and the presence of an integrated market should translate into convergence in banking efficiency.…”

Section: Literature Reviewmentioning

confidence: 99%

Bank efficiency, productivity, and convergence in EU countries: a weighted Russell directional distance model

Fujii

Managi

Matoušek

et al. 2017

The European Journal of Finance

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Abstract:The objective of this study is three-fold. First we estimate and analyse bank efficiency and productivity changes in the EU28 countries with the application of a novel approach, a weighted Russell directional distance model. Second, we take a disaggregated approach and analyse the contribution of the individual bank inputs on bank efficiency and productivity growth. Third, we test for convergence in EU28 bank productivity as well as in the inefficiency of individual bank inputs. We find that bank efficiency has been undermined by the financial crisis in banks notably from the EU15 countries. We also argue that bank efficiency and productivity in EU countries vary across the banking sector with banks from the 'old' EU showing higher efficiency levels. Nonetheless, a noticeable catching up process is observed for banks from the 'new' EU countries. Consequently, we do not find evidence of group convergence for bank productivity but there is evidence of convergence in bank efficiency change and technical change among the EU28 countries throughout the period 2005-2014. The driving force seems to be convergent technical change from the old EU Member States' banks.On the other hand, almost no convergence is detected for the banks' individual inputs while the transition paths show heightened diversity during the crisis years.JEL Classification: G21; D21; G23; C11

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Section: Literature Reviewmentioning

confidence: 99%

Bank efficiency, productivity, and convergence in EU countries: a weighted Russell directional distance model

Fujii

Managi

Matoušek

et al. 2017

The European Journal of Finance

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show abstract

“…Their findings suggested a significantly negative relationship. An empirical research made by Kasman [37] over more than 400 banks significantly evidenced the negative relationship between the net interest margin 2 and bank size. This is in line with the inverted U-curve theory which suggests a convex relationship between bank size and its profitability.…”

Section: Literature Reviewmentioning

confidence: 99%

The Determinants of Bank Performance: The Case of Tunisian Listed Banks

Chouikh¹,

Blagui²

2017

JFA

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This paper studies the relationship between Tunisian listed banks performance and two types of determinants; internal and external. The internal explanatory variables are: (1) the bank size, (2) privatization, (3) board size, (4) capital-to-assets ratio, and (5) cost of efficiency. The macro-economic (external) exogenous variables are: (1) gross domestic product growth rate and (2) inflation. Our panel-data analyses suggest a statistically significant and negative relationship between bank profitability (endogenous variable) and board size. However, the remaining variables were found to be statistically insignificant. This can be explained by two main sub-hypotheses: (a) state-owned banks included in the sample disturb the statistical significance of the results and (b) the year 2011 is a cut-off point that changed the Tunisian bank performance determinants.

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“…In relative terms, the mean value of net interest margin is relatively high. For example, this measure is equal to 0.8 percent in Luxemburg, 1.6 percent in Finland, 2.9 percent in Germany, and 1.07 percent (Kasman et al, 2014).…”

Section: The Empirical Resultsmentioning

confidence: 99%

The nexux between financial development, foreign deposits, retail banking and financial inclusion: The Jordanian case

Omet¹,

Abdel-Halim²

2017

Pressacademia

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As a major part of the Jordanian financial system, this paper examines the banking sector at both the macro and micro levels. Based on the time period 1982-2015, and time series methodologies (co-integration, Vector Error Correction Model, and Granger Causality), the macrolevel analysis examines the impact of foreign exchange deposits on financial development. Using the Seemingly-Unrelated Regression (SUR), the micro-level aspect examines the impact of foreign exchange deposits and retail banking on the performance of banks in terms of their net interest margin and accounting performance. Finally, the fact that greater financial inclusion promotes credit to the private sector, we estimate an Ordered Probit Model to examine the determinants of financial inclusion in Jordan. We conclude that foreign exchange deposits reflect weak evidence in explaining the variability of bank credit. In other words, foreign exchange deposits do not promote financial development. The micro-level analysis, on the other hand, reveals that foreign exchange deposits and retail banking impact bank profitability in a positive manner. However, this impact (positive) comes only at the expense of widening net interest margins. Finally, the results reveal that higher income, better education, being a man, and being older are associated with greater levels of financial inclusion. Naturally, based on the empirical results, the paper outlines a number of recommendations whose aim is to promote financial development as well as the performance of the banking system.

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Consolidation and commercial bank net interest margins: Evidence from the old and new European Union members and candidate countries

Cited by 142 publications

References 16 publications

Bank efficiency, productivity, and convergence in EU countries: a weighted Russell directional distance model

Bank efficiency, productivity, and convergence in EU countries: a weighted Russell directional distance model

The Determinants of Bank Performance: The Case of Tunisian Listed Banks

The nexux between financial development, foreign deposits, retail banking and financial inclusion: The Jordanian case

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