The Impact of the Global Financial Crisis on Banking Globalization

Stijn Claessens () and Neeltje Van Horen ()

No 2014/197, IMF Working Papers from International Monetary Fund

Abstract: Although cross-border bank lending has fallen sharply since the crisis, extending our bank ownership database from 1995-2009 up to 2013 shows only limited retrenchment in foreign bank presence. While banks from OECD countries reduced their foreign presence (but still represent 89% of foreign bank assets), those from emerging markets and developing countries expanded abroad and doubled their presence. Especially advanced countries hit by a systemic crisis reduced their presence abroad, with far flung and relatively small investments more likely to be sold. Poorer and slower growing countries host fewer banks today, while large investments less likely expanded. Conversely, faster host countries’ growth and closeness to potential investors meant more entry. Lending by foreign banks locally grew more than cross-border bank claims did for the same home-host country combination, and each was driven by different factors. Altogether, our evidence shows that global banking is not becoming more fragmented, but rather is going through some important structural transformations with a greater variety of players and a more regional focus.

Keywords: WP; foreign bank; bank presence; host country; banking system; market share; Foreign banks; financial globalization; global financial crisis; cross-border banking; financial fragmentation; OECD country; cross-border lending; bank ownership; bank asset; banks from emerging markets; group level; Emerging and frontier financial markets; Bank credit; Commercial banks; Global; Central and Eastern Europe; Central Asia; Asia and Pacific; Africa (search for similar items in EconPapers)
Pages: 50
Date: 2014-10-27
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Citations: View citations in EconPapers (32)

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Related works:
Journal Article: The Impact of the Global Financial Crisis on Banking Globalization (2015)
Working Paper: The Impact of the Global Financial Crisis on Banking Globalization (2014)
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