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Inherited or Earned? Performance of Foreign Banks in Central and Eastern Europe, Emilia Magdalena Jurzyk and Olena Havrylchyk

Label
Inherited or Earned? Performance of Foreign Banks in Central and Eastern Europe, Emilia Magdalena Jurzyk and Olena Havrylchyk
Language
eng
Abstract
Using a combination of propensity score matching and difference-in-difference techniques we investigate the impact of foreign bank ownership on the performance and market power of acquired banks operating in Central and Eastern Europe. This approach allows us to control for selection bias as larger but less profitable banks were more likely to be acquired by foreign investors. We show that during three years after the takeover, banks have become more profitable due to cost minimization and better risk management. They have additionally gained market share, because they passed their lower cost of funds to borrowers in terms of lower lending rates. Previous studies failed to pick up the improvements in performance of takeover banks, because they did not account for the performance of financial institutions before acquisitions
Bibliography note
Includes bibliographical references
Illustrations
illustrations
Index
no index present
Literary Form
non fiction
Main title
Inherited or Earned? Performance of Foreign Banks in Central and Eastern Europe
Nature of contents
dictionariesbibliography
Oclc number
724512884
Responsibility statement
Emilia Magdalena Jurzyk and Olena Havrylchyk
Series statement
IMF Working Papers
Table Of Contents
Contents; I. Introduction; II. Related Literature; III. Methodology; IV. Description of the Data; V. Descriptive Statistics and Evidence of the Selection Bias; VI. Propensity Score Matching to Control for the Selection Bias; VII. Results From the Difference-in-Difference Analysis on the Matched Sample; VIII. Additional Robustness Checks; IX. Conclusions; References; Tables; Description of Variables; Descriptive Statistics; Logit Regression; Results of the matching procedure for ROA and Market Share; Results of the matching procedure for ROA and Market Share-Same SampleResults of the Matching Procedure-Decomposition of ROA and SizeResults of the Matching Procedure-Sample Restricted to Two and Three; Results of the Matching Procedure for ROA and Market; Results of the Matching Procedure for ROA and Market Share.; Figures; ROA Trajectories for Takeover, Greenfield, and Domestic Banks; Market Share Trajectories for Takeover, Greenfield, and Domestic Banks; Appendix; List of Matched Banks
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