African Financial Development Dynamics: Big Time Convergence

Simplice Asongu

No 12/003, Working Papers of the African Governance and Development Institute. from African Governance and Development Institute.

Abstract: Purpose - Assessment of African financial development dynamic convergences in money, credit, efficiency and size. Design/Methodology - The empirical evidence is premised on 11 homogenous panels based on regions (Sub-Saharan and North Africa), income-levels (low, middle, lower-middle and upper-middle), legal-origins (English common-law and French civil-law) and religious dominations (Christianity and Islam). We examine convergence in financial intermediary dynamics of depth, efficiency, activity and size. Findings - Findings suggest that countries with small-sized financial intermediary depth, efficiency, activity and size are catching-up countries with large-sized financial intermediary depth, efficiency, activity and size respectively. We also provide the speeds of convergence and time necessary to achieve a full (100%) convergence. Practical implications - The presence of strong links among African banking sectors may present little opportunity for portfolio diversification. The convergence patterns show positive steps towards regional integration. As a policy implication, African governments should not relent in structural and institutional reforms. Originality/value - It is the first critical assessment of convergence in financial intermediary development dynamics in the African continent.

Keywords: Convergence; Policy Coordination; Banking; Africa (search for similar items in EconPapers)
JEL-codes: F15 F36 F42 O55 P52 (search for similar items in EconPapers)
Pages: 47
Date: 2012-01-19
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Forthcoming in African Journal of Economics and Management Studies

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http://www.afridev.org/RePEc/agd/agd-wpaper/Africa ... time-convergence.pdf Revised version, 2013 (application/pdf)

Related works:
Journal Article: African financial development dynamics: big time convergence (2014)
Working Paper: African Financial Development Dynamics: Big Time Convergence (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:agd:wpaper:12/003

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