Foreign Bank Presence in Developing Countries 1995-2006: Data and Trends

51 Pages Posted: 19 Mar 2008

See all articles by Stijn Claessens

Stijn Claessens

Bank for International Settlements (BIS)

Neeltje van Horen

Bank of England; Centre for Economic Policy Research (CEPR)

Tugba Gurcanlar

World Bank

Joaquin Mercado Sapiain

World Bank; London Business School

Date Written: March 2008

Abstract

This paper describes an extensive data collection effort on foreign bank entry and documents important trends and patterns in foreign banks' presence. The data collected cover the period 1995-2006 and include the full bilateral matrix of individual bank source and host countries, and the mode of entry. We document that there has been a sharp increase in foreign bank presence in most regions over this period, with especially low and lower middle income countries observing much new entry. We also show that banks from developing countries are becoming more prominent investors, especially in small developing countries and countries where income levels are low. Even though many of these banks are small in comparison to their high-income counterparts, they are very significant in many of the markets they do business in. The paper concludes, however, that the exact determinants of this changing pattern in foreign bank entry and its implications for domestic banking system performance - in terms of efficiency, competitiveness, access to finance and stability - remain to be investigated.

Keywords: foreign direct investment, international banking, cross-border banking

JEL Classification: F21, F23, G21

Suggested Citation

Claessens, Stijn and van Horen, Neeltje and Gurcanlar, Tugba and Mercado Sapiain, Joaquin, Foreign Bank Presence in Developing Countries 1995-2006: Data and Trends (March 2008). Available at SSRN: https://ssrn.com/abstract=1107295 or http://dx.doi.org/10.2139/ssrn.1107295

Stijn Claessens (Contact Author)

Bank for International Settlements (BIS) ( email )

Centralbahnplatz 2
CH-4002 Basel
Switzerland

Neeltje Van Horen

Bank of England ( email )

Threadneedle Street
London, EC2R 8AH
United Kingdom

HOME PAGE: http://https://www.bankofengland.co.uk/research/Researchers/neeltje-van-horen

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

Tugba Gurcanlar

World Bank ( email )

1818 H Street NW
Washington, DC 20433
United States
202-684-1722 (Phone)

Joaquin Mercado Sapiain

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

London Business School ( email )

Sussex Place
Regent's Park
London, NW1 4SA
United Kingdom
+44 (0)20 7000 7599 (Phone)
+44(0)20 7000 7561 (Fax)

Register to save articles to
your library

Register

Paper statistics

Downloads
1,393
Abstract Views
4,759
rank
13,580
PlumX Metrics