Changes in Bank Specialisation: Comparing Foreign Subsidiaries and Branches in Luxembourg

Banque centrale du Luxembourg Working Paper No. 67, 2011

Posted: 1 Sep 2020

See all articles by Paolo Guarda

Paolo Guarda

Banque Centrale du Luxembourg

Claudia Curi

Free University of Bolzano-Bozen, Faculty of Economics and Management

Valentin Zelenyuk

University of Queensland

Date Written: October 12, 2011

Abstract

Presumably, foreign banks open subsidiaries and branches in Luxembourg to perform different tasks. This paper studies the balance sheet structure of banks in Luxembourg, testing for difference across groups and across periods. Non-parametric methods yield several findings. First, specialisation and heterogeneity vary across years as well as across different market segments. Second, comparing subsidiaries and branches, estimated distributions across banks have been relatively similar for Interbank Loans but have become rather different for Interbank Deposits. For Customer Loans and Customer Deposits, the differences across groups are generally greater, especially for Customer Deposits. Third, in 2009 the financial crisis generally sharpened the differences between subsidiaries and branches for all variables considered. Fourth, long-term changes between 1995 and 2007 appear to be (temporarily?) reversed between 2007 and 2009 by the financial crisis.

Keywords: Luxembourg Banks; Banking activities; Convergence; Distribution Dynamics; Non-Parametric kernel

JEL Classification: C14, G21, D30

Suggested Citation

Guarda, Paolo and Curi, Claudia and Zelenyuk, Valentin, Changes in Bank Specialisation: Comparing Foreign Subsidiaries and Branches in Luxembourg (October 12, 2011). Banque centrale du Luxembourg Working Paper No. 67, 2011, Available at SSRN: https://ssrn.com/abstract=3659028

Paolo Guarda (Contact Author)

Banque Centrale du Luxembourg ( email )

2, boulevard Royal
Luxembourg, L-2983
Luxembourg

Claudia Curi

Free University of Bolzano-Bozen, Faculty of Economics and Management ( email )

Universitätsplatz 1-Piazza Università 1
Bozen-Bolzano, Bolzano 39100
Italy
+39 0471 13498 (Phone)

Valentin Zelenyuk

University of Queensland ( email )

St Lucia
Brisbane, Queensland 4072
Australia

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