Concentration and foreign penetration in Latin American banking sectors: impact on competition and risk

In recent years, Latin American banking sectors have experienced an accelerated process of concentration and foreign penetration that has prompted diverse views regarding its implications for the competitive behavior of banks and for the financial stability of the system as a whole. Exploiting a ric...

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Autor principal: Levy Yeyati, Eduardo
Formato: Documento de trabajo acceptedVersion
Publicado: Universidad Torcuato Di Tella. Escuela de Negocios. Centro de Investigaciones en Finanzas (CIF) 2017
Materias:
Bancos
Competencia
Acceso en línea:http://repositorio.utdt.edu/handle/utdt/6259
Aporte de:
Repositorio Digital Universidad Torcuato Di Tella de Universidad Torcuato Di Tella
id I57-R16320.500.13098-6259
record_format dspace
institution Universidad Torcuato Di Tella
institution_str I-57
repository_str R-163
collection Repositorio Digital Universidad Torcuato Di Tella
topic Bancos
Competencia
spellingShingle Bancos
Competencia
Levy Yeyati, Eduardo
Concentration and foreign penetration in Latin American banking sectors: impact on competition and risk
description In recent years, Latin American banking sectors have experienced an accelerated process of concentration and foreign penetration that has prompted diverse views regarding its implications for the competitive behavior of banks and for the financial stability of the system as a whole. Exploiting a rich bank-level balance sheet database for eight Latin American countries, we examine the evolution of concentration and foreign penetration indicators and their impact on competition and risk. We find that, while concentration did not reduce competition in the industry, foreign penetration appears to have led to less competitive banking sectors. Moreover, we find banking sector fragility to be positively related to competition and, through this channel, negatively related to foreign participation, despite the fact that foreign banks in the region are associated with higher insolvency risk due to higher leverage ratios and more volatile returns.
format Documento de trabajo
acceptedVersion
author Levy Yeyati, Eduardo
author_facet Levy Yeyati, Eduardo
author_sort Levy Yeyati, Eduardo
title Concentration and foreign penetration in Latin American banking sectors: impact on competition and risk
title_short Concentration and foreign penetration in Latin American banking sectors: impact on competition and risk
title_full Concentration and foreign penetration in Latin American banking sectors: impact on competition and risk
title_fullStr Concentration and foreign penetration in Latin American banking sectors: impact on competition and risk
title_full_unstemmed Concentration and foreign penetration in Latin American banking sectors: impact on competition and risk
title_sort concentration and foreign penetration in latin american banking sectors: impact on competition and risk
publisher Universidad Torcuato Di Tella. Escuela de Negocios. Centro de Investigaciones en Finanzas (CIF)
publishDate 2017
url http://repositorio.utdt.edu/handle/utdt/6259
work_keys_str_mv AT levyyeyatieduardo concentrationandforeignpenetrationinlatinamericanbankingsectorsimpactoncompetitionandrisk
bdutipo_str Repositorios
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