Is the Chinese banking system benefiting from foreign investors?

Alicia Garcia-Herrero and Daniel Santabárbara
Authors registered in the RePEc Author Service: Alicia Garcia Herrero

No 804, Working Papers from BBVA Bank, Economic Research Department

Abstract: We find empirical evidence that the Chinese banking system has benefited from the entry of foreign investors through higher profitability and increased efficiency of the banking system. Foreign partcipation, which consists of a minority stake in a Chinese bank (in contrast to the typical pattern in emerging countries), appears to be most effective when the foreign bank acts as a strategic investor. Purely financial investors contribute little, if anything, to bank performance.

Keywords: China; banking system; foreign participation (search for similar items in EconPapers)
JEL-codes: G21 G28 (search for similar items in EconPapers)
Pages: 21 pages
Date: 2008-06
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Citations: View citations in EconPapers (6)

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