Exploiting old customers and attracting new ones: The case of bank deposit pricing
Santiago Carbo-Valverde,
Timothy Hannan and
Francisco Rodriguez-Fernandez
Authors registered in the RePEc Author Service: Santiago Carbo Valverde and
Francisco Rodríguez Fernández ()
European Economic Review, 2011, vol. 55, issue 7, 903-915
Abstract:
Recent theoretical contributions suggest that deposit interest rates should be higher in geographic areas characterized by greater in-migration and lower for depositors at banks with greater shares of existing (or so-called “locked-in”) depositors. These hypotheses are tested using a rich data set obtained for the Spanish banking industry. Results confirm that, all else equal, banks offer higher deposit rates in territories characterized by greater in-migration, and also that they tend to offer lower rates, the larger the number of their locked-in depositors. These findings confirm the existence of the trade-off between exploiting old customers and attracting new ones.
Keywords: Deposit pricing; In-migration; Locked-in customers (search for similar items in EconPapers)
JEL-codes: G21 L11 (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (28)
Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0014292111000250
Full text for ScienceDirect subscribers only
Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:55:y:2011:i:7:p:903-915
DOI: 10.1016/j.euroecorev.2011.02.001
Access Statistics for this article
European Economic Review is currently edited by T.S. Eicher, A. Imrohoroglu, E. Leeper, J. Oechssler and M. Pesendorfer
More articles in European Economic Review from Elsevier
Bibliographic data for series maintained by Catherine Liu ().