Determinants of the Interest Rate Margins of Austrian Banks

David Liebeg () and Markus Schwaiger ()
Additional contact information
David Liebeg: Oesterreichische Nationalbank, Financial Markets Analysis and Surveillance Division
Markus Schwaiger: Oesterreichische Nationalbank, Financial Markets Analysis and Surveillance Division, http://www.oenb.at

Financial Stability Report, 2006, issue 12, 104-116

Abstract: Bank interest rate margins have been declining in most EU Member States over the last decade. Drawing on a unique sample of supervisory data for the Austrian banking system from 1996 to 2005, this paper investigates the determinants of bank interest rate margins. The main factors driving the reduction of Austrian banks’ interest rate margins are decreasing operating costs, the growing importance of foreign currency lending combined with a rising share of non interest revenues as well as increasing competition. In contrast to findings in the literature we document a positive effect of relationship banking on margins, with the erosion of relationship banking being another reason for the decline in interest margins.

Keywords: Banks (search for similar items in EconPapers)
JEL-codes: C33 E40 G21 (search for similar items in EconPapers)
Date: 2006
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Downloads: (external link)
https://www.oenb.at/dam/jcr:f4bc3d82-f544-4dce-bea ... s_04_tcm16-49856.pdf (application/pdf)

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:onb:oenbfs:y:2006:i:12:b:4

Ordering information: This journal article can be ordered from
Oesterreichische Nationalbank, Documentation Management and Communications Services, Otto-Wagner Platz 3, A-1090 Vienna, Austria

Access Statistics for this article

Financial Stability Report is currently edited by Markus Schwaiger, Birgit Niessner, Vanessa Redak and Martin Schuerz

More articles in Financial Stability Report from Oesterreichische Nationalbank (Austrian Central Bank) P.O. Box 61, A-1011 Vienna, Austria. Contact information at EDIRC.
Bibliographic data for series maintained by Stefan W. Schmitz ().