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on Banking |
| By: | John K. Ashton (Centre for Competition Policy, University of East Anglia); Khac Pham (Centre for Competition Policy, University of East Anglia) |
| Abstract: | This study provides an empirical assessment of the efficiency and interest rate changes occurring during 61 UK retail bank mergers. Key findings of the work include the general efficiency enhancing influence of UK bank mergers and the limited effect of merger on retail interest rates. Furthermore, different banking products appear to be influenced differently by mergers. It is proposed that future assessments of bank competition and mergers require an accommodation of different types of bank customer. |
| Keywords: | Retail banking, mergers, efficiency and price effects |
| JEL: | G14 G21 |
| Date: | 2007–06 |
| URL: | http://d.repec.org/n?u=RePEc:ccp:wpaper:wp07-09&r=ban |
| By: | Nataliya Fedorenko; Dorothea Schäfer; Oleksandr Talavera |
| Abstract: | The paper focuses on the effects of three different internal bank ratings - Risk-, Property- and Creditworthiness-Rating - on the loan maturity. We use a sample of about 5,000 loans given to sole proprietors and corporate borrowers by two German banks from January 2003 till July 2005. The estimation results for corporate borrowers are consistent with Diamond's (1991) predictions of non-monotonic relationship between ratings and maturity. The best rated and the worst rated loans tend to have shorter maturities than loans with an intermediate rating. However, our results for sole proprietors conflict with the predictions of Diamond and with the majority of the empirical literature. We find a negative association between ratings and maturity of the loans given to sole proprietors. |
| Keywords: | loan maturity, internal bank ratings, risk of default, creditworthiness |
| JEL: | C25 D82 G20 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp704&r=ban |
| By: | Camacho-Gutiérrez, Pablo; González-Cantú, Vanessa M. |
| Abstract: | This paper extends Wheelock and Kumbhakar’s (1995) test for moral hazard in the Kansas deposit insurance system (1910-1920). This paper tests and finds evidence of omitted bank-specific effects. Estimates in Wheelock and Kumbhakar (1995), as a result, are biased. This paper introduces unobserved individual heterogeneity to the test for moral hazard, corrects their estimates, and finds more evidence of moral hazard in the Kansas deposit insurance system. |
| Keywords: | Deposit insurance; moral hazard test; panel data; random and fixed effects. |
| JEL: | C33 G21 C35 G28 |
| Date: | 2007–05–31 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:3909&r=ban |
| By: | Hubert BONIN (GREThA) |
| Abstract: | French banking expansion in China and South-East Asia had to respect the powerful influence of British banks there. From the 1860s French merchant and banking interests had been involved in Hong Kong business because of the colonial developments in Indochina and the links between this area and the Hong Kong centre. The growth of commercial links between the colony and China favoured further integration of banking and currency exchanges with Hong Kong, through the Banque de l’Indochine corporation, competing with Hsbc. It was itself committed to finance Asian-French commercial flows (silk, etc.) directly (Lyon, Bordeaux, Paris) or indirectly (London branch) took part to banking links with France. But Hong Kong also became a bridgehead for Banque de l’Indochine into southern China (Canton, etc.) from the1890s up to the 1930s and, in parallel with the Shanghai branch, its branch there asserted itself as a part of French expansion in the Far-East. |
| Keywords: | Imperialism, First Globalization; Bank; Overseas; China; Hong-Kong; Guangzhou |
| JEL: | G20 N25 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:grt:wpegrt:2007-09&r=ban |
| By: | Robert DeYoung; W. Scott Frame; Dennis Glennon; Daniel P. McMillen; Peter J. Nigro |
| Abstract: | We study recent changes in the geographic distances between small businesses and their bank lenders using a large random sample of loans guaranteed by the Small Business Administration. Consistent with extant research, we find that small borrower-lender distances generally increased between 1984 and 2001, with a rapid acceleration in distance beginning in the late 1990s. We also document a new phenomenon: a fundamental reordering of borrower-lender distance by the borrowers’ neighborhood income and race characteristics. Historically, borrower-lender distance tended to be shorter than average for historically underserved (for example, low-income and minority) areas, but by 2000 borrowers in these areas tended to be farther away from their lenders on average. This structural change is coincident in time with the adoption of credit scoring models that rely on automated lending processes and quantitative information, and we find indirect evidence consistent with this link. Our findings suggest that there has been increased entry into local markets for small business loans, and this development should help allay fears that movement toward automated lending processes will reduce small businesses’ access to credit in already underserved markets. |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedawp:2007-11&r=ban |