The concentration and bank stability in Central and Eastern European countries

Renata Karkowska and Małgorzata Pawłowska

No 272, NBP Working Papers from Narodowy Bank Polski

Abstract: The aim of this paper is to discuss changes in the banking sectors in Central and Eastern European countries, with particular emphasis on the change in market structure, the concentration and the share of foreign capital, in an attempt to determine the relationship between market structure and stability in the period 1999-2015. Using the methodology of panel regression, GMM estimator, we examine the implications of banks’ concentration that manifest themselves as spreading and growing instability. The study contributes to the literature by focusing on a group of countries from Central and Eastern Europe, which are not explain in previous research and they are playing the role of a host country for banks from a number of countries in Europe. Finally, our results reveal that the persistence of risk is affected by the level of bank concentration and this effect is exacerbated during the downturn.

Keywords: banking; concentration; foreign ownership; stability; CEE countries (search for similar items in EconPapers)
JEL-codes: F36 G2 G21 G34 L1 (search for similar items in EconPapers)
Pages: 30
Date: 2017
New Economics Papers: this item is included in nep-cfn, nep-mon and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:nbp:nbpmis:272

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