EconPapers    
Economics at your fingertips  
 

Geographic deregulation and commercial bank performance in U.S. state banking markets

YongDong Zou, Stephen Miller () and Bernard Malamud

The Quarterly Review of Economics and Finance, 2011, vol. 51, issue 1, 28-35

Abstract: This paper examines the effects of geographical deregulation on commercial bank performance across states. We reach several general conclusions. First, the process of deregulation on an intrastate basis generally improves bank profitability and performance with higher returns and reduced riskiness. Deregulation of interstate banking produces mixed findings. For small banks, interstate banking deregulation leads to reduced riskiness. For medium-sized banks, it leads to increased riskiness. And for large banks, it leads to increased and decreased riskiness depending on the risk variable considered. Second, macroeconomic variables - the unemployment rate, real personal income per capita, and the growth rate of real personal income - and the average interest rate affect bank performance as much, or more, than the process of deregulation, especially for the small and medium-sized banks. The large banks, however, generally do not respond significantly to state-level macroeconomic variables or the average interest rate. Finally, while some analysts argue that deregulation toward full interstate banking and branching produced more efficient banks and a healthier banking system, we find mixed results on this issue.

Keywords: Commercial; banks; Geographic; deregulation; Bank; performance (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1062-9769(10)00066-9
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Geographic Deregulation and Commerical Bank Performance in US State Banking Markets (2008) Downloads
Working Paper: Geographic Deregulation and Commercial Bank Performance in US State Banking Markets (2008) Downloads
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:quaeco:v:51:y:2011:i:1:p:28-35

Access Statistics for this article

The Quarterly Review of Economics and Finance is currently edited by R. J. Arnould and J. E. Finnerty

More articles in The Quarterly Review of Economics and Finance from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2019-10-19
Handle: RePEc:eee:quaeco:v:51:y:2011:i:1:p:28-35