Cover IMF Working Papers
Foreign Banks: Trends, Impact and Financial Stability
Author:
Neeltje van Horennull

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Mr. Stijn Claessens
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Series:
IMF Working Papers
Volume/Issue:
Volume 2012: Issue 010
Language:
English
Publication Date:
01 Jan 2012
DOI:
https://doi.org/10.5089/9781463931155.001
ISBN:
9781463931155
ISSN:
1018-5941
Pages:
40
Keywords:
WP; bank; lending; bank characteristic; parent bank; emerging market banks; Foreign banks; foreign direct investment; cross-border banking; bilateral investment; financial globalization; financial sector development; financial stability; spillovers; financial crisis; foreign bank; providing emerging market banks incentive; investment activity; domestic bank; Emerging and frontier financial markets; Credit; Commercial banks; Global; Asia and Pacific; Middle East; Central and Eastern Europe; South Asia
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper introduces a comprehensive database on bank ownership for 137 countries over 1995-2009, and reviews foreign bank behavior and impact. It documents substantial increases in foreign bank presence, with many more home and host countries. Current market shares of foreign banks average 20 percent in OECD countries and 50 percent elsewhere. Foreign banks have higher capital and more liquidity, but lower profitability than domestic banks do. Only in developing countries is foreign bank presence negatively related with domestic credit creation. During the global crisis foreign banks reduced credit more compared to domestic banks, except when they dominated the host banking systems.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund
Volume 2012: Issue 010