Banking in transition economies: does foreign ownership enhance profitability?
Year: 2008
Type: article
Abstract: This paper studies the relationship between foreign ownership and bank performance. A cross-section of 216 banks in transition economies in Central and Eastern Europe and Central Asia is used. In the analyses a continuous foreign ownership variable is applied. The results are checked by using a foreign ownership dummy variable. A negative relationship is found between foreign ownership and banks’ interest revenues and profitability, although overhead costs are negatively related to foreign bank ownership as well. The results are independent of countries’ GDP per capita and concentration in the banking sector. Evidence is presented for the existence of a home field advantage for domestic banks.
Source: European Journal of Finance
Authors: Ilko Naaborg, Robert Lensink
Institutions: University of Groningen, University of Nottingham
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2034425190