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Foreign Banks and Financial Development - Foreign Bank Lending in CEE Countries
Köthe, Anja ; Hlaváček, Michal (advisor) ; Svoboda, Karel (referee) ; Korosteleva, Julia (referee)
Foreign Banks and Financial Development - Foreign Bank Lending in CEE Countries Master thesis Anja Köthe Abstract The objective of this paper is to investigate the relation between foreign banks and financial development and to focus on foreign bank lending, in particular. The research focuses on four countries with a high share of foreign banks: Czech Republic, Hungary, Poland and Slovakia. Using a dataset of 122 banks over a 10 year period from 2005 to 2015 a fixed effects panel regression models is used for an empirical analysis. Loan growth as a proxy for lending behaviour and credit stability is used as the dependent variable. The empirical models investigate the determinants of loan growth in foreign and domestic banks as well as the dependence of foreign bank subsidiaries on their parent banks. The regression results indicate that domestic banks are more dependent on local economic conditions and bank performance. Their credit supply depends more on their profitability, loan quality and domestic market share. Foreign bank subsidiaries, in contrast, exhibit greater independence from local economic conditions and also from subsidiary performance indicators such as profitability ratios. Instead their lending behaviour is significantly influenced by the financial characteristics of their parent banks.
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Foreign Banks and Financial Development - Foreign Bank Lending in CEE Countries
Köthe, Anja ; Hlaváček, Michal (advisor) ; Svoboda, Karel (referee) ; Korosteleva, Julia (referee)
Foreign Banks and Financial Development - Foreign Bank Lending in CEE Countries Master thesis Anja Köthe Abstract The objective of this paper is to investigate the relation between foreign banks and financial development and to focus on foreign bank lending, in particular. The research focuses on four countries with a high share of foreign banks: Czech Republic, Hungary, Poland and Slovakia. Using a dataset of 122 banks over a 10 year period from 2005 to 2015 a fixed effects panel regression models is used for an empirical analysis. Loan growth as a proxy for lending behaviour and credit stability is used as the dependent variable. The empirical models investigate the determinants of loan growth in foreign and domestic banks as well as the dependence of foreign bank subsidiaries on their parent banks. The regression results indicate that domestic banks are more dependent on local economic conditions and bank performance. Their credit supply depends more on their profitability, loan quality and domestic market share. Foreign bank subsidiaries, in contrast, exhibit greater independence from local economic conditions and also from subsidiary performance indicators such as profitability ratios. Instead their lending behaviour is significantly influenced by the financial characteristics of their parent banks.
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Financial Globalization and Macroeconomic Volatility: an Empirical Study of the Effects of Foreign Bank Presence on the Volatility of Consumption and Growth
Casula, Chiara ; Cahlík, Tomáš (advisor) ; Hlaváček, Jiří (referee)
Financial integration has been at the centre of a wide debate, especially with respect to its effects on stability, inequality and welfare. This thesis presents an empirical investigation on the relationship between financial integration and macroeconomic volatility. The present study takes advantage of the publication of a new database on integration in the banking industry, and estimates its effects on the volatility of output and consumption, on a set of 136 countries over the years 1996 to 2009, using regions and country fixed effects. The analysis focuses on the effect of foreign bank presence on macroeconomic volatility, and as a further application, on the effect of foreign bank assets on macroeconomic volatility. Furthermore, the present study will determine whether the findings change for Central and Eastern European Countries and the countries of the Commonwealth of Independent States. The main finding is that foreign bank presence is significantly related to the volatility of output, but it is not related to the volatility of private consumption growth. The original contribution of this paper is to empirically analyse data on foreign bank presence as proxies for financial integration, and to relate them to the volatility of output and consumption.
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Foreign bank participation in transition economies: the effects on access to credit
Krafková, Anna ; Geršl, Adam (advisor) ; Marková, Katarína (referee)
The thesis discusses the topic of foreign bank participation in transition economies. First part presents theoretical considerations about foreign bank entry and their empirical support. The main focus is then on the empirical investigation of the possible relation between the degree of foreign bank participation and the availability of credit across transition countries. Combining responses from a survey of firms operating in 38 transition economies with data on the degree of foreign bank participation, we derived some interesting conclusions. The analysis suggests that conditions for obtaining credit seem to be better in economies having higher share of foreign banks within countries of Central and Eastern Europe. The opposite conclusion was derived for countries of Commonwealth of Independent States; there economies with higher foreign presence tend to perceive conditions of financing as more problematic. Moreover, it was shown that enterprise size, its ownership and sector within which operates also matter when drawing conclusions on the effects on foreign bank on the availability of credit. Additionally, we identified that the share of state-owned banks and the effectiveness of domestic banking sector are other determinants of credit accessibility.
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