A geographic perspective on banking in Central, Eastern and Southeastern Europe

Elisabeth Beckmann, Sarah Reiter () and Helmut Stix
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Sarah Reiter: Oesterreichische Nationalbank, Off-Site Supervision Division – Significant Institutions, https://www.oenb.at/

Focus on European Economic Integration, 2018, issue Q1-18, 26-47

Abstract: This study presents a novel dataset covering the geographic locations of bank branches in ten Central, Eastern and Southeastern European (CESEE) countries. Based on these data, we describe the spatial provision of banking services and study whether domestically owned and foreign-owned banks show different branching behavior. We find that the provision of banking services varies substantially between and within countries. Regressions show that these differences strongly correlate with the respective countries’ GDP per capita. With regard to the question whether foreign and domestic banks show different branching behavior, we detect marked differences across countries. Thus, there is no “one-size-fits-all” explanation for the market behavior of foreign (and Austrian) banks in CESEE. In general, foreign banks in CESEE tend to branch in regions with higher population density. An exception among foreign banks are Austrian banks, which, on average across regions, also locate in areas with lower population density. When we match bank branch location data with household survey data, we find that the majority of CESEE households have a bank available within 2 km. Nevertheless, a sizeable share of CESEE households live 5 km or farther from the nearest bank branch. We provide indicators of bank branch coverage, density, concentration and ownership at Nomenclature of Territorial Units for Statistics 3 (NUTS 3) level for download on the OeNB website.

Keywords: bank branches; local market structure; spatial competition; foreign banks; Central; Eastern and Southeastern Europe; database (search for similar items in EconPapers)
JEL-codes: D12 D80 G11 (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (6)

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