Market concentration, risk-taking, and bank performance: evidence from emerging economies

Zhang, Jianhua and Jiang, Chunxia and Qu, Baozhi and Wang, Peng (2013) Market concentration, risk-taking, and bank performance: evidence from emerging economies. International Review of Financial Analysis, 30 . pp. 149-157. ISSN 1057-5219

[img]
Preview
PDF - Final accepted version (with author's formatting)
Available under License Creative Commons Attribution-NonCommercial-NoDerivatives.

Download (775kB) | Preview
This item is available in: Library Catalogue

Abstract

This paper investigates the relationship between market concentration, risk-taking, and bank performance using a unique dataset of the BRIC banks over the period 2003-2010. We find a negative association between market concentration and performance, in support of the “quiet life” hypothesis. We also find that banks taking a lower level of risks perform better, in favour of prudential practice. Moreover, the BRICs’ banking sectors were all negatively affected by the 2007-2008 global financial crisis with China and Russia being the least and most affected, respectively. On average Chinese and Brazilian banks outperform Indian and Russian ones, indicating that China and Brazil have more favourable institutional infrastructure. These results are robust to alternative model specifications and estimation techniques. Our analysis may have important policy implications for bankers and regulators in the BRICs and other developing and transition countries.

Item Type: Article
Additional Information: Available online 23 August 2013
Keywords (uncontrolled): Market concentration, Risk-taking, Bank performance; Stochastic frontier analysis; Brazil; Russia; India; China
Research Areas: A. > Business School > Economics
Item ID: 17221
Useful Links:
Depositing User: Chunxia Jiang
Date Deposited: 10 Jul 2015 14:09
Last Modified: 13 Oct 2016 14:36
URI: http://eprints.mdx.ac.uk/id/eprint/17221

Actions (login required)

Edit Item Edit Item

Full text downloads (NB count will be zero if no full text documents are attached to the record)

Downloads per month over the past year