Foreign banks in sub-Saharan Africa [Elektronische Ressource] : do south-south and north-south banks induce different effects on the efficiency of domestic banks? / vorgelegt von Birte Pohl

Pohl Ingrid, Birte

Informations

• Publié par: ruhr-universitat_bochum
• Publié le: 01 janvier 2010
• Nombre de lectures: 28
• Langue: English
• Poids de l'ouvrage: 1 Mo

Extrait

Foreign Banks in sub-Saharan Africa –
Do South-South and North-South Banks
Induce Different Effects on the Efficiency of
Domestic Banks?
INAUGURALDISSERTATION
zur
Erlangung der Wurde¨
eines Doktors der
Wirtschaftswissenschaft
der
Fakultat fur Wirtschaftswissenschaft¨ ¨
der
Ruhr-Universitat Bochum¨
vorgelegt von
¨Diplom-Okonomin Birte Pohl
aus Dortmund
2010i
Dekan: Prof. Dr. Helmut Karl
Referent: Prof. Dr. Wim K¨osters
Korreferent: Prof. Dr. Thomas K. Bauer
Tag der mundlichen Prufung: 03. November 2010¨ ¨Contents
List of Tables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v
List of Figures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ix
List of Abbreviations . . . . . . . . . . . . . . . . . . . . . . . . . . x
List of Symbols . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xiii
1 Introduction 1
2 Economics of Multinational Banking 5
2.1 Theories of Multinational Banks . . . . . . . . . . . . . . . . . 5
2.1.1 Internalization Theory . . . . . . . . . . . . . . . . . . 6
2.1.2 Eclectic Theory . . . . . . . . . . . . . . . . . . . . . . 8
2.2 Effects of Foreign Bank Presence in Developing Countries . . . 15
2.2.1 Direct and Indirect Effects . . . . . . . . . . . . . . . . 15
2.2.2 Channels of Spillover Effects . . . . . . . . . . . . . . . 17
2.2.3 Determinants of Spillover Effects . . . . . . . . . . . . 20
2.3 The Opportunities For South-South Integration . . . . . . . . 26
3 Banking in sub-Saharan Africa 32
3.1 Development and Actual State of the Banking Sectors . . . . . 32
3.2 Regional Integration Initiatives in sub-Saharan Africa . . . . . 38
3.3 The Indirect Effects of South-South and North-South Banks
in sub-Saharan Africa . . . . . . . . . . . . . . . . . . . . . . . 45
iiContents iii
4 Econometric Analysis – Related Literature, Data and
Methodology 54
4.1 Related Literature . . . . . . . . . . . . . . . . . . . . . . . . 54
4.2 Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
4.2.1 Bankscope Database – General Information . . . . . . 70
4.2.2 Shareholder Analysis . . . . . . . . . . . . . . . . . . . 72
4.2.3 Bank-specific Variables . . . . . . . . . . . . . . . . . . 76
4.2.4 Data on Foreign Bank Presence . . . . . . . . . . . . . 82
4.2.5 Country-specific Variables . . . . . . . . . . . . . . . . 91
4.2.6 Comparison of Bank Account Data of Foreign and
Domestic Banks . . . . . . . . . . . . . . . . . . . . . . 94
4.3 Empirical Models and Hypotheses . . . . . . . . . . . . . . . . 99
4.4 Estimation Methods . . . . . . . . . . . . . . . . . . . . . . . 102
5 Econometric Analysis – Estimation Results 107
5.1 Baseline Results . . . . . . . . . . . . . . . . . . . . . . . . . . 107
5.1.1 Competition Effects of Foreign Bank Presence . . . . . 107
5.1.2 Spillover Effects of Foreign Bank Presence . . . . . . . 112
5.2 Sensitivity Analysis . . . . . . . . . . . . . . . . . . . . . . . . 117
5.2.1 Countries with Fluctuating Foreign Bank Presence . . 117
5.2.2 Exclusion of Kenyan Domestic Banks . . . . . . . . . . 120
5.2.3 Weighting . . . . . . . . . . . . . . . . . . . . . . . . . 122
5.2.4 Importance of Institutional Conditions . . . . . . . . . 123
5.2.5 An Alternative Measure of Bank Efficiency . . . . . . . 126
6 Conclusions 133Contents iv
Appendix 137
A Income Classification of Sampled Countries . . . . . . . . . . . 137
B Description and Sources of Data . . . . . . . . . . . . . . . . . 138
C Sample of Banks and their Country of Origin . . . . . . . . . 139
D Results of the Sensitivity Analysis: Countries with Fluctuat-
ing Foreign Bank Presence . . . . . . . . . . . . . . . . . . . . 150
E Results of the Sensitivity Analysis: Exclusion of Kenyan
Domestic Banks . . . . . . . . . . . . . . . . . . . . . . . . . . 154
F Results of the Sensitivity Analysis: Weighting . . . . . . . . . 158
G ResultsoftheSensitivityAnalysis: ImportanceofInstitutional
Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162
H Results of the Sensitivity Analysis: An Alternative Measure
of Bank Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . 168
References 196
Acknowledgements 197
Curriculum Vitae 199List of Tables
2.1 OLI Advantages of MNBs . . . . . . . . . . . . . . . . . . . . 12
2.2 SourcesandTypesofCompetitiveAdvantagesofSouth-South
Multinationals . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
3.1 Number of Banks in sub-Saharan Africa . . . . . . . . . . . . 36
3.2 Bank Private Sector Credit to GDP in 2007 (%) . . . . . . . . 37
4.1 Domestic vs. Foreign Banks’ Efficiency . . . . . . . . . . . . . 57
4.2 Effects of Foreign Banks on Domestic Banks’ Efficiency . . . . 64
4.3 Summary Statistics – Bank-Specific Variables . . . . . . . . . 81
4.4 Summary Statistics – Number of Foreign Banks to Total
Number of Banks (Number Measure) . . . . . . . . . . . . . . 89
4.5 Summary Statistics – Share of Foreign Banks’ Assets to Total
Banking Sector Assets (Asset Measure) . . . . . . . . . . . . . 90
4.6 Summary Statistics – Share of Foreign Banks’ Assets to Total
Banking Sector Assets (New Asset Measure) . . . . . . . . . . 91
4.7 Summary Statistics – Country-Specific Variables . . . . . . . . 93
4.8 Comparison of Domestic and Foreign Banks’ Efficiency . . . . 98
5.1 Net Margin – Baseline Results (Number Measure) . . . . . . . 110
5.2 Net Margin – Baseline Results (Asset Measure) . . . . . . . . 111
5.3 Net Margin – Baseline Results (New Asset Measure) . . . . . 113
5.4 Costs – Baseline Results (Number Measure) . . . . . . . . . . 114
5.5 Costs – Baseline Results (Asset Measure). . . . . . . . . . . . 115
5.6 Costs – Baseline Results (New Asset Measure) . . . . . . . . . 116
5.7 Extract: Net Margin – Countries with Fluctuating Foreign
Bank Presence (Number Measure and Asset Measure) . . . . . 118
vList of Tables vi
5.8 Extract: Net Margin – Countries with Fluctuating Foreign
Bank Presence (New Asset Measure) . . . . . . . . . . . . . . 118
5.9 Extract: Costs – Countries with Fluctuating Foreign Bank
Presence (Number Measure and Asset Measure) . . . . . . . . 119
5.10 Extract: Costs – Countries with Fluctuating Foreign Bank
Presence (New Asset Measure). . . . . . . . . . . . . . . . . . 119
5.11 Extract: Net Margin – Exclusion of Kenyan Domestic Banks
(Number Measure and Asset Measure) . . . . . . . . . . . . . 120
5.12 Extract: Net Margin – Exclusion of Kenyan Domestic Banks
(New Asset Measure) . . . . . . . . . . . . . . . . . . . . . . . 121
5.13 Extract: Costs – Exclusion of Kenyan Domestic Banks
(Number Measure and Asset Measure) . . . . . . . . . . . . . 122
5.14 Extract: Costs – Exclusion of Kenyan Domestic Banks (New
Asset Measure) . . . . . . . . . . . . . . . . . . . . . . . . . . 122
5.15 Extract: Net Margin – Governance (Number Measure and
Asset Measure) . . . . . . . . . . . . . . . . . . . . . . . . . . 124
5.16 Extract: Net Margin – Governance (New Asset Measure) . . . 124
5.17 Extract: Costs – Governance (Number Measure and Asset
Measure). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
5.18 Extract: Costs – Governance (New Asset Measure) . . . . . . 125
5.19 Extract: Costs – Rule of Law (Number Measure and Asset
Measure). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126
5.20 Extract: Costs – Rule of Law (New Asset Measure) . . . . . . 126
5.21 Cost-Income Ratio – Baseline Results (Number Measure and
Asset Measure) . . . . . . . . . . . . . . . . . . . . . . . . . . 127
5.22 Cost-Income Ratio – Baseline Results (New Asset Measure) . 128
5.23 Extract: Cost-IncomeRatio –CountrieswithFluctuatingFor-
eign Bank Presence (Number Measure and Asset Measure) . . 130
5.24 Extract: Cost-IncomeRatio –CountrieswithFluctuatingFor-
eign Bank Presence (New Asset Measure). . . . . . . . . . . . 130
5.25 Extract: Cost-Income Ratio – Exclusion of Kenyan Domestic
Banks (Number Measure and Asset Measure) . . . . . . . . . 131List of Tables vii
5.26 Extract: Cost-Income Ratio – Exclusion of Kenyan Domestic
Banks (New Asset Measure) . . . . . . . . . . . . . . . . . . . 131
5.27 Extract: Cost-Income Ratio – Governance (Number Measure
and Asset Measure) . . . . . . . . . . . . . . . . . . . . . . . . 132
5.28 Extract: Cost-Income Ratio –Governance(New Asset Measure)132
A.1 Income Classification of Sampled Countries . . . . . . . . . . . 137
B.1 Description and Sources of Data . . . . . . . . . . . . . . . . . 138
C.1 Sample of Banks and their Country of Origin . . . . . . . . . 141
C.2 Bank Name Abbreviations . . . . . . . . . . . . . . . . . . . . 149
D.1 Net Margin – Countries with Fluctuating Foreign Bank
Presence (Number Measure and Asset Measure) . . . . . . . . 150
D.2 Net Margin – Countries with Fluctuating Foreign Bank
Presence (New Asset Measure) . . . . . . . . . . . . . . . . . . 151
D.3 Costs – Countries with Fluctuating Foreign Bank Presence
(Number Measure and Asset Measure) . . . . . . . . . . . . . 152
D.4 Costs – Countries with Fluctuating Foreign Bank Presence
(New Asset Measure) . . . . . . . . . . . . . . . . . . . . . . . 153
E.1 Net Margin – Exclusion of Kenyan Domestic Banks
(Number Measure and Asset Measure) . . . . . . . . . . . . . 154
E.2 Net Margin – Exclusion of Kenyan Domestic Banks
(New Asset Measure