How Does Bank Competition Affect Systemic Stability?

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collection.link.5
https://openknowledge.worldbank.org/handle/10986/9
collection.name.5
Policy Research Working Papers
dc.contributor.author
Anginer, Deniz
dc.contributor.author
Demirguc-Kunt, Asli
dc.contributor.author
Zhu, Min
dc.date.accessioned
2012-03-19T17:29:25Z
dc.date.available
2012-03-19T17:29:25Z
dc.date.issued
2012-02-01
dc.description.abstract
Using bank level measures of competition and co-dependence, the authors show a robust positive relationship between bank competition and systemic stability. Whereas much of the extant literature has focused on the relationship between competition and the absolute level of risk of individual banks, they examine the correlation in the risk taking behavior of banks, hence systemic risk. They find that greater competition encourages banks to take on more diversified risks, making the banking system less fragile to shocks. Examining the impact of the institutional and regulatory environment on systemic stability shows that banking systems are more fragile in countries with weak supervision and private monitoring, with generous deposit insurance and greater government ownership of banks, and public policies that restrict competition. Furthermore, lack of competition has a greater adverse effect on systemic stability in countries with low levels of foreign ownership, weak investor protections, generous safety nets, and where the authorities provide limited guidance for bank asset diversification.
en
dc.identifier.uri
http://hdl.handle.net/10986/3267
dc.language
English
dc.relation.ispartofseries
Policy Research working paper ; no. WPS 5981
dc.rights
CC BY 3.0 IGO
dc.rights.holder
World Bank
dc.rights.uri
http://creativecommons.org/licenses/by/3.0/igo/
dc.subject
ACCESS TO FINANCIAL SERVICES
dc.subject
ACCOUNTING
dc.subject
ADVERSE EFFECT
dc.subject
AMOUNT OF CAPITAL
dc.subject
ASSET DIVERSIFICATION
dc.subject
ASSET PRICE
dc.subject
ASSET PRICES
dc.subject
ASSET VALUE
dc.subject
ASSET VALUES
dc.subject
ASSETS RATIO
dc.subject
AUSTRIAN NATIONAL BANK
dc.subject
BALANCE SHEET
dc.subject
BANK ACTIVITIES
dc.subject
BANK ASSET
dc.subject
BANK ASSETS
dc.subject
BANK CAPITAL
dc.subject
BANK COMPETITION
dc.subject
BANK CREDIT
dc.subject
BANK ENTRY
dc.subject
BANK HOLDING
dc.subject
BANK HOLDING COMPANIES
dc.subject
BANK INVESTORS
dc.subject
BANK MARKET
dc.subject
BANK POLICY
dc.subject
BANK PROFITABILITY
dc.subject
BANK REGULATION
dc.subject
BANK RISK
dc.subject
BANK RISK TAKING
dc.subject
BANK RUNS
dc.subject
BANK SUPERVISION
dc.subject
BANKING ASSETS
dc.subject
BANKING CONCENTRATION
dc.subject
BANKING CRISIS
dc.subject
BANKING INDUSTRIES
dc.subject
BANKING SECTOR
dc.subject
BANKING STRUCTURE
dc.subject
BANKING SYSTEM
dc.subject
BANKING SYSTEMS
dc.subject
BANKRUPTCY
dc.subject
BANKS
dc.subject
BOOK VALUE
dc.subject
BORROWING
dc.subject
BUSINESS CYCLE
dc.subject
CALL OPTION
dc.subject
CAPITAL REGULATION
dc.subject
CAPITAL REQUIREMENTS
dc.subject
CAPITALIZATION
dc.subject
CDS
dc.subject
CHANNELS OF CREDIT
dc.subject
CHECKS
dc.subject
COMMERCIAL BANKS
dc.subject
COMPETITION POLICIES
dc.subject
COMPETITION POLICY
dc.subject
COMPETITIVE MARKETS
dc.subject
CONNECTIVITY
dc.subject
CORPORATE DEBT
dc.subject
COUNTRY FIXED EFFECT
dc.subject
COUNTRY FIXED EFFECTS
dc.subject
CREDIT ALLOCATION
dc.subject
CREDIT CRUNCH
dc.subject
CREDIT INFORMATION
dc.subject
CREDIT MARKET
dc.subject
CREDIT MARKETS
dc.subject
CREDIT RISK
dc.subject
DEBT
dc.subject
DEFAULT PROBABILITIES
dc.subject
DEFAULT PROBABILITY
dc.subject
DEFAULT RISK
dc.subject
DEFAULT RISKS
dc.subject
DEPOSIT
dc.subject
DEPOSIT INSURANCE
dc.subject
DEPOSIT INSURANCE COVERAGE
dc.subject
DEPOSIT MONEY BANKS
dc.subject
DEPOSITS
dc.subject
DEREGULATION
dc.subject
DIVIDEND
dc.subject
DIVIDEND RATE
dc.subject
DUMMY VARIABLE
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ECONOMIC DEVELOPMENT
dc.subject
ECONOMIC STABILITY
dc.subject
ECONOMICS
dc.subject
EMERGING MARKETS
dc.subject
ENTRY BARRIERS
dc.subject
ENTRY REQUIREMENTS
dc.subject
EQUITY RETURNS
dc.subject
EQUITY VALUE
dc.subject
EXCLUSION
dc.subject
EXIT POLICIES
dc.subject
EXPOSURE
dc.subject
EXPOSURE TO RISK
dc.subject
FACE VALUE
dc.subject
FEDERAL RESERVE
dc.subject
FEDERAL RESERVE BANK
dc.subject
FEDERAL RESERVE BANK OF NEW YORK
dc.subject
FEE INCOME
dc.subject
FINANCIAL CONTAGION
dc.subject
FINANCIAL CRISES
dc.subject
FINANCIAL CRISIS
dc.subject
FINANCIAL DEVELOPMENT
dc.subject
FINANCIAL FRAGILITY
dc.subject
FINANCIAL INFORMATION
dc.subject
FINANCIAL INNOVATIONS
dc.subject
FINANCIAL INSTITUTION
dc.subject
FINANCIAL INSTITUTIONS
dc.subject
FINANCIAL INTERMEDIATION
dc.subject
FINANCIAL POLICY
dc.subject
FINANCIAL PRODUCTS
dc.subject
FINANCIAL SECTOR
dc.subject
FINANCIAL SERVICES
dc.subject
FINANCIAL STABILITY
dc.subject
FINANCIAL STRUCTURE
dc.subject
FINANCIAL STUDIES
dc.subject
FINANCIAL SYSTEM
dc.subject
FINANCIAL SYSTEMS
dc.subject
FOREIGN BANK
dc.subject
FOREIGN ENTRY
dc.subject
FOREIGN INVESTORS
dc.subject
FOREIGN OWNERSHIP
dc.subject
FOREIGN OWNERSHIP OF BANKS
dc.subject
GLOBAL BANKING
dc.subject
GLOBAL BUSINESS
dc.subject
GLOBAL MARKET
dc.subject
GLOBAL STOCK MARKET
dc.subject
GLOBALIZATION
dc.subject
GOVERNMENT OWNERSHIP
dc.subject
GOVERNMENT OWNERSHIP OF BANKS
dc.subject
GOVERNMENT POLICIES
dc.subject
GROUP OF BANK
dc.subject
GROWTH RATE
dc.subject
IMPLICIT GUARANTEE
dc.subject
INFORMATION ASYMMETRY
dc.subject
INFORMATION ON BORROWERS
dc.subject
INFORMATION SHARING
dc.subject
INPUT PRICES
dc.subject
INSTITUTIONAL ENVIRONMENT
dc.subject
INTEREST EXPENSES
dc.subject
INTEREST INCOME
dc.subject
INTEREST RATES
dc.subject
INTERNATIONAL BANK
dc.subject
INTERNATIONAL BANKS
dc.subject
INTERNATIONAL FINANCIAL SYSTEM
dc.subject
INTERPOLATION
dc.subject
INVESTOR PROTECTION
dc.subject
LACK OF COMPETITION
dc.subject
LEVEL OF RISK
dc.subject
LEVELS OF CREDIT
dc.subject
LIBERALIZATION
dc.subject
LIQUIDITY
dc.subject
LOAN
dc.subject
LOAN DEFAULTS
dc.subject
LOAN LOSS PROVISIONS
dc.subject
LOAN MARKET
dc.subject
LOW ENTRY BARRIER
dc.subject
MARGINAL COST
dc.subject
MARKET COMPETITION
dc.subject
MARKET DISCIPLINE
dc.subject
MARKET EQUITY
dc.subject
MARKET INFORMATION
dc.subject
MARKET INTEGRATION
dc.subject
MARKET LIQUIDITY
dc.subject
MARKET VALUE
dc.subject
MONEY MARKET
dc.subject
MORAL HAZARD
dc.subject
NEW MARKETS
dc.subject
OPERATING EXPENSES
dc.subject
OPERATING INCOME
dc.subject
OUTPUT
dc.subject
PERSONNEL EXPENSES
dc.subject
PORTFOLIOS
dc.subject
PRIVATE BANKS
dc.subject
PRIVATE CREDIT
dc.subject
PRIVATE SECTOR DEVELOPMENT
dc.subject
PROBABILITY OF DEFAULT
dc.subject
PROFITABILITY
dc.subject
PROFITABILITY MEASURES
dc.subject
PRUDENTIAL REGULATION
dc.subject
PUBLIC POLICIES
dc.subject
PUBLIC POLICY
dc.subject
REAL ESTATE
dc.subject
REGULATORS
dc.subject
REGULATORY AUTHORITIES
dc.subject
REGULATORY ENVIRONMENT
dc.subject
REGULATORY FRAMEWORK
dc.subject
RETURN
dc.subject
RETURN ON ASSETS
dc.subject
RISK DIVERSIFICATION
dc.subject
RISK OF BANK FAILURE
dc.subject
RISK SHARING
dc.subject
RISK TAKING
dc.subject
SAFETY NET
dc.subject
SAFETY NETS
dc.subject
SECURITIES
dc.subject
SHARE OF ASSETS
dc.subject
SHAREHOLDER
dc.subject
SMALL BANKS
dc.subject
SOURCES OF CREDIT
dc.subject
STATE GUARANTEES
dc.subject
STOCK MARKET
dc.subject
STOCK MARKET CAPITALIZATION
dc.subject
STOCK MARKETS
dc.subject
STOCK PRICE
dc.subject
STOCK RETURN
dc.subject
SUPERVISORY AUTHORITIES
dc.subject
SUPERVISORY POWER
dc.subject
SUPERVISORY POWERS
dc.subject
SUPERVISORY POWER
dc.subject
SYNCHRONOUS STOCK PRICE MOVEMENTS
dc.subject
SYSTEMIC BANKING CRISES
dc.subject
SYSTEMIC RISK
dc.subject
TRADING
dc.subject
TRADING INCOME
dc.subject
TREASURY
dc.subject
TREASURY YIELD
dc.subject
VALUE OF ASSETS
dc.subject
VOLATILITY
dc.title
How Does Bank Competition Affect Systemic Stability?
en
okr.date.disclosure
2012-02-01
okr.doctype
Publications & Research :: Policy Research Working Paper
okr.docurl
http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20120229120053
okr.googlescholar.linkpresent
yes
okr.identifier.doi
10.1596/1813-9450-5981
okr.identifier.externaldocumentum
000158349_20120229120053
okr.identifier.internaldocumentum
15878473
okr.identifier.report
WPS5981
okr.language.supported
en
okr.pdfurl
http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2012/02/29/000158349_20120229120053/Rendered/PDF/WPS5981.pdf
en
okr.region.administrative
The World Region
okr.sector
Finance :: General finance sector
okr.unit
Development Research Group (DECRG)
okr.unit
DECRG: Finance & Priv Sec Devt (DECFP)
okr.volume
1 of 1

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