The Stability-Concentration Relationship in the Brazilian Banking System

Benjamin Miranda Tabak (), Solange Guerra, Eduardo José Araújo Lima () and Eui Chang

No 145, Working Papers Series from Central Bank of Brazil, Research Department

Abstract: In this article the relation between non-performing loans (NPL) of the Brazilian banking system and macroeconomic factors, systemic risk and banking concentration is empirically tested. While evaluating this relation, we use a dynamic specification with fixed effects, using a panel data approach. The empirical results indicate that the banking concentration has a statistically significant impact on NPL, suggesting that more concentrated banking systems may improve financial stability. These results are important for the design of banking regulation policies.

New Economics Papers: this item is included in nep-ban, nep-com, nep-reg and nep-rmg
Date: 2007-10
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Related works:
Journal Article: The stability-concentration relationship in the Brazilian banking system (2008)
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Persistent link: http://EconPapers.repec.org/RePEc:bcb:wpaper:145

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