The Impact of Market Structure and the Business Cycle on Bank Profitability
Author: Małgorzata Pawłowska
Publisher:
Published: 2015
Total Pages: 0
ISBN-13:
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Author: Małgorzata Pawłowska
Publisher:
Published: 2015
Total Pages: 0
ISBN-13:
DOWNLOAD EBOOKAuthor: Małgorzata Pawłowska (ekonomia)
Publisher:
Published: 2015
Total Pages: 30
ISBN-13:
DOWNLOAD EBOOKAuthor: Małgorzata Pawłowska
Publisher:
Published: 2015
Total Pages: 30
ISBN-13:
DOWNLOAD EBOOKAuthor: Arnold Andersen Heggestad
Publisher:
Published: 1973
Total Pages: 194
ISBN-13:
DOWNLOAD EBOOKAuthor: David G. McMillan
Publisher:
Published: 2015
Total Pages: 48
ISBN-13:
DOWNLOAD EBOOKThis paper documents the recent changing structure of the US bank market, as it has become more deregulated and specifically asks how this affects bank behaviour as it relates to profits and risk. Using a variety of approaches, such as the HHI and Lerner measures, we document a general increase in concentration and market power, at least until the recent crisis period. Importantly, we then consider whether these changes, or whether bank specific and general economic conditions have a greater impact on bank profit and risk. Results support the view that changes to market structure (especially market power) while positively impacting profit and persistence do not lead to increased risk. However, market share (or bank size) does, albeit not for the largest banks. Results also support the view that banks may increase some elements of risk as well as profit during an economic expansion. Notwithstanding, this an overriding feature of the results is differences in the conditioning factors across size strata and time. This leads to the conclusion that there is no simple relationship between market structure and competition and risk and that benign economic condition play a key role in reducing competition and possibly increasing risk. The key implication of the results is the need for more nuanced policy-making with regard to bank size, performance and economic conditions.
Author: Małgorzata Olszak
Publisher:
Published: 2020
Total Pages:
ISBN-13:
DOWNLOAD EBOOKAuthor: Ugo Albertazzi
Publisher:
Published: 2006
Total Pages: 48
ISBN-13:
DOWNLOAD EBOOKAuthor: Morten Balling
Publisher: Routledge
Published: 2006-04-18
Total Pages: 346
ISBN-13: 1134173784
DOWNLOAD EBOOKFinancial services firms play a key role in the European economy. The efficiency and profitability of these firms and the competition among them have an impact on allocation of savings, financing of investment, economic growth, the stability of the financial system and the transmission of monetary policy. This collection of research contributions includes evaluations of trends in the European financial service industry and examinations of the driving forces of efficiency, competition and profitability of financial firms and institutions in Europe. The papers have been written by leading academics and researchers in the field, who specialize in strategic, systematic and policy issues related to the European financial services industry. This edited collection will be will be essential reading for students and academics but will also be of interest to financial practitioners and government officials interested in acquiring a deeper understanding of this complex issue.
Author: Natalya Martynova
Publisher: International Monetary Fund
Published: 2015-11-25
Total Pages: 44
ISBN-13: 1513517589
DOWNLOAD EBOOKTraditional theory suggests that more profitable banks should have lower risk-taking incentives. Then why did many profitable banks choose to invest in untested financial instruments before the crisis, realizing significant losses? We attempt to reconcile theory and evidence. In our setup, banks are endowed with a fixed core business. They take risk by levering up to engage in risky ‘side activities’(such as market-based investments) alongside the core business. A more profitable core business allows a bank to borrow more and take side risks on a larger scale, offsetting lower incentives to take risk of given size. Consequently, more profitable banks may have higher risk-taking incentives. The framework is consistent with cross-sectional patterns of bank risk-taking in the run up to the recent financial crisis.
Author: Jacob A. Bikker
Publisher:
Published: 2005
Total Pages: 88
ISBN-13: 9783902109279
DOWNLOAD EBOOKThis paper brings to the forefront the assumptions that we make when focussing on a particular type of explanation for bank profitability. We evaluate a broad field of research by introducing a general framework for a profit maximizing bank and demonstrate how different types of models can be fitted into this framework. Next, we present an overview of the current major trends in European banking and relate them to each model's assumptions, thereby shedding light on the relevance, timeliness and shelf life of the different models. This way, we arrive at a set of recommendations for a future research agenda. We advocate a more prominent role for output prices, and suggest a modification of the intermediation approach. We also suggest ways to more clearly distinguish between market power and effciency, and explain why we need time-dependent models. Finally, we propose the application of existing models to different size classes and sub-markets. Throughout we emphasize the benefits from applying several, complementary models to overcome the identification problems that we observe in individual models.