The profitability of small, single-market banks in an era of multimarket banking
AbstractThis paper examines the relationship between multimarket bank presence and the profitability (and therefore viability) of small, single-market banks. We find that increased presence of multimarket banks is associated with a significant reduction in the profitability of small, single-market banks operating in rural banking markets, but not of those operating in urban markets. We explore this relationship by breaking single-market bank profits down into several components in order to shed light on the mechanisms through which multimarket bank presence might influence the profitability of single-market banks.
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Bibliographic InfoPaper provided by Board of Governors of the Federal Reserve System (U.S.) in its series Finance and Economics Discussion Series with number 2006-41.
Date of creation: 2006
Date of revision:
Other versions of this item:
- Hannan, Timothy H. & Prager, Robin A., 2009. "The profitability of small single-market banks in an era of multi-market banking," Journal of Banking & Finance, Elsevier, vol. 33(2), pages 263-271, February.
- NEP-ALL-2006-12-16 (All new papers)
- NEP-BAN-2006-12-16 (Banking)
- NEP-COM-2006-12-16 (Industrial Competition)
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