 BANK RECAPITALIZATION AND MARKET CONCENTRATION IN GHANA’S BANKING INDUSTRY: A HERFINDAHL-HIRSCHMAN INDEX ANALYSISSamuel Yaw Akomea and Michael Adusei Global Journal of Business Research, 2013, vol. 7, issue 3, 31-45 Abstract: Using Concentration Ratio and Herfindahl-Hirschman Index techniques, the paper investigates the concentration levels of the banking industry in Ghana and forecasts the future concentration levels of the industry should consolidations triggered by the new bank recapitalization policy occur in the industry. The study finds that the HHI indices provide evidence for the contention that for the past eight years the banking industry in Ghana has been highly competitive with no signs of concentration. Evidence also exists to underpin the conclusion that any consolidation of four banks or less stimulated by the new bank recapitalization policy will not upset the existing market concentration. However, consolidation of five or more banks will culminate in high concentration which will be inimical to the interest of customers. The paper, therefore, recommends that, all things being equal, policy makers should permit consolidation of four or less banks if that is the only way the banks will meet the new bank recapitalization requirement. Keywords: Banking; Market Concentration; Herfindahl-Hirschman Index; Ghana (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:ibf:gjbres:v:7:y:2013:i:3:p:31-45 Access Statistics for this article Global Journal of Business Research is currently edited by Terrance Jalbert More articles in Global Journal of Business Research from The Institute for Business and Finance Research |
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