The Performance of Foreign-Owned Banks in Host Country Economies

Fišerová, Tereza; Teplý, Petr; Tripe, David

doi:10.18267/j.pep.527

Cited by 9 publications

(7 citation statements)

References 34 publications

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“…By choosing the proper explanatory variables, we follow the papers by De Young and Rice (2004a), Shahida et al (2006), Moshirian et al (2011), ECB FSR (2013) and Fišerová et al (2015). The independent variables are summarized in Table 2.…”

Section: Variablesmentioning

confidence: 99%

Determinants of Bank Fee Income in the EU Banking Industry - Does Market Concentration Matter?

Vozková¹,

Teplý²

2018

Prague Economic Papers

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In this paper, we analyse the key determinants of bank fee and commission income in the European Union with a special emphasis on market concentration. On a sample of 258 EU banks during the 2007-2014 period, we apply System Generalized Method of Moments. First, we argue that the banks facing higher competition tend to expand more aggressively into non-traditional activities, and therefore they report a higher share of fee income in total income. Second, we found that a higher equity to assets ratio is related with higher shares of fee income since the bank needs more capital to prevent or manage the potential risks of the non-traditional activities. Finally, a high deposits to assets ratio tends to increase the fee income share, which may be possibly attributed to relatively high switching costs and to close depositor-bank relationship in the EU banks.

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Section: Variablesmentioning

confidence: 99%

Determinants of Bank Fee Income in the EU Banking Industry - Does Market Concentration Matter?

Vozková¹,

Teplý²

2018

Prague Economic Papers

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“…Thus we can infer that large and transparent firms are more likely to benefit from the government-owned and foreign banks. Fiserova et al (2015) in a cross country analysis showed that performance of the foreign banks in the host nation is not only affected by the bank own characteristics but also due to the economic condition of the host nation such as inflation rate and GDP growth.…”

Section: Empirical Evidencementioning

confidence: 99%

Does bank ownership affect relationship lending: A developing country perspective

Rahman

Belás

Rosza³

et al. 2017

Journal of International Studies

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Abstract. In this paper we aim to explore how the type of bank ownership -local private banks, government-owned banks (public banks) and foreign banks -can affect relationship lending to small and medium enterprises (SMEs) by using a unique data set from Bangladeshi banking sector. We found that private banks differ from government-owned and foreign banks in terms of relationship lending and credit facilities to SMEs. More specifically, our results suggest that unlike government and foreign banks, private banks do consider soft information from relationship lending while setting up the loan spread to SMEs. We can also confirm that exclusive banking relationship or repeated banking with private banks can soften credit conditions (loan maturity and covenants). Moreover, we found empirical evidence that banking relationship is important for private banks in terms of SME credit risk evaluation. Finally, as according to our expectation, the results confirm that regardless of prior relationship, private banks are more Vol.10, No.1, 2017 278 depended on collateral-based lending to SMEs than government-owned or foreign banks.

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“…ECB (2010) considered ROA as a more reliable indicator than ROE because it is adjusted for the leverage effect. Fišerová et al (2015) confirmed the superiority of ROA as a performance indicator for foreign banks in CEE countries. Additionally, Bonin et al (2005) indicated weakness of ROE in CEE countries because of large standard deviation.…”

Section: Resultsmentioning

confidence: 53%

Have More Profitable Banks a More or a Less Risky Lending Policy? Empirical Evidence from CEE Countries

Perić¹

2018

Prague Economic Papers

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This paper investigates the short and long-run relationship between credit risk and two bank profitability indicators ROA and ROE in Central and Eastern European countries during the period from 2000 to 2010. Results from previous research mostly confirm the negative relationship between profitability and credit risk by considering the current or one year lagged value of profitability. Certain crisis indicates that more profitable banks before the crisis became more risky during the time of crisis. These results motivate us to upgrade the model of credit risk by including earlier values of profitability. Results indicate that two or three years are necessary for growth of profitability to increase credit risk. However, the long-run relationship between foreign banks' profitability and credit risk is positive, for both indicators. For the domestic bank, the longrun effect of ROA on credit risk is positive, while for ROE this relationship is negative.

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The Performance of Foreign-Owned Banks in Host Country Economies

Cited by 9 publications

References 34 publications

Determinants of Bank Fee Income in the EU Banking Industry - Does Market Concentration Matter?

Determinants of Bank Fee Income in the EU Banking Industry - Does Market Concentration Matter?

Does bank ownership affect relationship lending: A developing country perspective

Have More Profitable Banks a More or a Less Risky Lending Policy? Empirical Evidence from CEE Countries

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