Share This Article:

Bank Ownership and Efficiency in the New EU Members

Full-Text HTML Download Download as PDF (Size:110KB) PP. 68-72
DOI: 10.4236/me.2012.31010    5,487 Downloads   8,880 Views   Citations

ABSTRACT

The aim of this study is to analyze how banking ownership affects banking efficiency in countries which have recently experienced the European integration process more intensely. Using a Bayesian Stochastic Frontier Approach (SFA) applied to panel data, we have estimated efficiency levels in a sample of 226 banks from 12 countries during the period 2000 to 2008. The results show no significant differences between different types of private ownership, questioning the relevance of ownership as a determinant of banking efficiency in these countries. In addition, we have not found any evidence to suggest that foreign ownership is more efficient than its domestic counterpart. These results contradict the popular belief about the higher efficiency levels associated with foreign ownership.

Conflicts of Interest

The authors declare no conflicts of interest.

Cite this paper

J. Moreno, J. Gallizo and M. Salvador, "Bank Ownership and Efficiency in the New EU Members," Modern Economy, Vol. 3 No. 1, 2012, pp. 68-72. doi: 10.4236/me.2012.31010.

References

[1] J. P. Bonin, I. Hasan and P. Wachtel, “Privatization Matters: Bank Efficiency in Transition Countries,” Journal of Banking and Finance, Vol. 29, No. 8-9, 2005, pp. 2155- 2178. doi:10.1016/j.jbankfin.2005.03.012
[2] S. Claessens, A. Demirgü?-Kunt and H. Huizinga, “How Does Foreign Entry Affect the Domestic Banking Market?” Journal of Banking and Finance, Vol. 25, No. 5, 2001, pp. 891-911. doi:10.1016/S0378-4266(00)00102-3
[3] S. Fries and A. Taci, “Cost Efficiency of Banks in Transition: Evidence from 289 Banks in 15 Post-Communist Countries,” Journal of Banking and Finance, Vol. 29, No. 1, 2005, pp. 55-81. doi:10.1016/j.jbankfin.2004.06.016
[4] O. Havrylchyk, “Efficiency of the Polish Banking Industry: Foreign versus Domestic Banks,” Journal of Banking and Finance, Vol. 30, No. 7, 2006, pp. 1975-1996. doi:10.1016/j.jbankfin.2005.07.009
[5] C.J. Green, V. Murinde and I. Nikolov, “The efficiency of Foreign Banks in Central and Eastern Europe: Evidence on Economies of Scale and Scope,” Journal of Emerging Markets Finance, Vol. 3, No. 2, 2004, pp. 175-205. doi:10.1177/097265270400300205
[6] I. Hasan and K. Marton, “Development and Efficiency of the Banking Sector in a Transitional Economy: Hungarian Experience,” Journal of Banking and Finance, Vol. 27, No. 12, 2003, pp. 2249-2271. doi:10.1016/S0378-4266(02)00328-X
[7] R. La Porta, F. López-De-Silanes and A. Shleifer, “Government Ownership of Banks,” Journal of Finance, Ame- rican Finance Association, Vol. 57, No. 1, 2002, pp. 265- 301.
[8] A. N. Berger and D. B. Humphrey, “Efficiency of Financial Institutions: International Survey and Directions for Future Research,” European Journal of Operational Research, Vol. 98, No. 2, 1997, pp. 175-212. doi:10.1016/S0377-2217(96)00342-6
[9] J. E. Griffin and M. F. J. Steel, “Bayesian Stochastic Frontier Analysis Using Winbugs,” Journal of Productiv- ity Analysis, Vol. 27, No. 3, 2007, pp. 163-176. doi:10.1007/s11123-007-0033-y
[10] C. Fernández, G. Koop and M. F. J. Steel, “A Bayesian Analysis of Multiple-Output Production Frontiers,” Jour- nal of Econometrics, Vol. 98, No. 1, 2000, pp. 47-79. doi:10.1016/S0304-4076(99)00074-3

  
comments powered by Disqus

Copyright © 2018 by authors and Scientific Research Publishing Inc.

Creative Commons License

This work and the related PDF file are licensed under a Creative Commons Attribution 4.0 International License.