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Foreign banks and financial stability in emerging markets: Evidence from the global financial crisis

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  • Vogel, Ursula
  • Winkler, Adalbert

Abstract

Foreign banks have increased their market share in many emerging markets since the mid-1990s. We examine whether this contributed to financial stability in the respective host countries in the global financial crisis. Our results suggest that the stabilizing impact of foreign banks was limited to the cross-border component of financial globalization and to two regions: Eastern Europe and Sub-Saharan Africa. Only in the latter region was this translated into more stable credit growth. Thus hopes that a stronger presence of foreign banks might help host countries in isolating domestic credit from international shocks did not materialize in the current crisis. --

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Bibliographic Info

Paper provided by Frankfurt School of Finance and Management in its series Frankfurt School - Working Paper Series with number 149.

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Date of creation: 2010
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Handle: RePEc:zbw:fsfmwp:149

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Keywords: Foreign banks; cross-border lending; bank credit; financial crisis;

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References

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Cited by:
  1. Kostka, Genia & Moslener, Ulf & Andreas, Jan G., 2011. "Barriers to energy efficiency improvement: Empirical evidence from small-and-medium sized enterprises in China," Frankfurt School - Working Paper Series 178, Frankfurt School of Finance and Management.
  2. Libman, Alexander & Kozlov, Vladimir & Schultz, André, 2012. "Roving bandits in action: Outside option and governmental predation in autocracies," Frankfurt School - Working Paper Series 190, Frankfurt School of Finance and Management.
  3. Böing, Philipp & Müller, Elisabeth, 2012. "Technological Capabilities of Chinese Enterprises: Who is Going to Compete Abroad?," Annual Conference 2012 (Goettingen): New Approaches and Challenges for the Labor Market of the 21st Century 62081, Verein für Socialpolitik / German Economic Association.
  4. Wagner, Charlotte, 2010. "From boom to bust: how different has microfinance been from traditional banking?," Frankfurt School - Working Paper Series 156, Frankfurt School of Finance and Management.
  5. Harhoff, Dietmar & Mueller, Elisabeth & Van Reenen, John, 2012. "What are the channels for technology sourcing? Panel data evidence from German companies," Frankfurt School - Working Paper Series 187, Frankfurt School of Finance and Management.
  6. Boeing, Philipp & Mueller, Elisabeth & Sandner, Philipp, 2012. "What makes Chinese firms productive? Learning from indigenous and foreign sources of knowledge," Frankfurt School - Working Paper Series 196, Frankfurt School of Finance and Management.
  7. Inklaar, Robert & Koetter, Michael & Noth, Felix, 2012. "Who's afraid of big bad banks? Bank competition, SME, and industry growth," Frankfurt School - Working Paper Series 197, Frankfurt School of Finance and Management.

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