Banking Sector Reform and Interest Rates in Transition Economies: Bank-Level Evidence from Kyrgyzstan

33 Pages Posted: 8 Mar 2007 Last revised: 29 May 2013

See all articles by Martin Brown

Martin Brown

University of St. Gallen

Maria Clara Rueda Maurer

Swiss National Bank

Tamara Pak

National Bank of Kyrgyz Republic

Nurlanbek Tynaev

National Bank of Kyrgyz Republic - Ministry of Finance

Date Written: September 26, 2008

Abstract

We examine the impact of financial sector reform on interest rate levels and spreads using bank-level data from Kyrgyzstan for 1998-2005. We find that besides macroeconomic stabilization, structural reforms to the banking sector have significantly contributed to lowering interest rate levels. In particular, our results suggest that foreign bank entry and efforts to consolidate the banking sector were important drivers in reducing deposit rates. In contrast, we find little impact of banking sector reform or macroeconomic stabilization on intermediation spreads.

Keywords: Transition, Financial Sector Development, Interest Rates

JEL Classification: G21, 016, P34

Suggested Citation

Brown, Martin and Maurer, Maria Clara Rueda and Pak, Tamara and Tynaev, Nurlanbek, Banking Sector Reform and Interest Rates in Transition Economies: Bank-Level Evidence from Kyrgyzstan (September 26, 2008). Available at SSRN: https://ssrn.com/abstract=968390 or http://dx.doi.org/10.2139/ssrn.968390

Martin Brown (Contact Author)

University of St. Gallen ( email )

Unterer Graben 21
St. Gallen, CH-9000
Switzerland

Maria Clara Rueda Maurer

Swiss National Bank ( email )

Borsenstrasse 15
CH-8022 Zurich
Switzerland

Tamara Pak

National Bank of Kyrgyz Republic ( email )

Umetalieva Street 101
Bishkek 720040
Kyrgyzstan

Nurlanbek Tynaev

National Bank of Kyrgyz Republic - Ministry of Finance ( email )

Kyrgyzstan

Register to save articles to
your library

Register

Paper statistics

Downloads
247
Abstract Views
1,791
rank
123,853
PlumX Metrics