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IMF Working Paper Monetary and Capital Markets Bank Efficiency amid Foreign Entry : Evidence from the Central American Region Prepared
| Content Provider | Semantic Scholar |
|---|---|
| Author | Wezel, Torsten |
| Copyright Year | 2010 |
| Abstract | This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate. This paper investigates the efficiency of domestic and foreign banks in the Central American region during 2002-07. Using two main empirical approaches, Data Envelopment Analysis and Stochastic Frontier Analysis, the paper finds that foreign banks are not necessarily more efficient than their domestic counterparts. If anything, the regional banks that were acquired by global banks in a wave of acquisitions during 2005-07 can keep up with the local institutions. The efficiency of these acquired banks, however, is shown to have dropped during the acquisition year, recovering only slightly thereafter. Finally, it is important to account for the environment in which banks operate, as country-, sectorand firm-specific characteristics are found to have a considerable influence on bank efficiency. JEL Classification Numbers: D24, G21 |
| File Format | PDF HTM / HTML |
| Alternate Webpage(s) | http://www.imf.org/external/pubs/ft/wp/2010/wp1095.pdf |
| Language | English |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
