banking and economic development
Ağustos 18, 2020

Contending with liberalisation: crisis and recovery of the Argentine banking sector in the period of 1994 to 2011

From the early 1990s until 1998, Argentina liberalised its banking system as part of a strategy to enter a globalised economy. The subsequent monetary policies, combined with ‘convertibilidad’ and an elevated government debt, led to a loss of confidence in the financial system, ending in the deep recession of 1998–2002. A sovereign debt default of $100 billion in December 2001 followed, and in January 2002 the fixed exchange regime was officially abandoned. This paper examines how firm-specific characteristics and the […]
Ağustos 18, 2020

Are Foreign Banks Better Performers Than Domestic Counterparts? Examining the Financialization Hypothesis in Mexico

This article analyzes the relationship between “financialization” and the performance of credit institutions in Mexico over the period 1999–2013. On average, foreign banks have higher cost-to-income ratio and return on assets than domestically owned banks. Non-interest income to gross revenue positively contributes to foreign bank profits, which highlights income other than conventional banking transactions. When considering references in the literature to non-interest income as a proxy for financialization, our results imply that domestic banks are more dependent on traditional lending, […]