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Ireland's Banking System - Looking Forward

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  • Thorsten Beck

    (Cass Business School, London; Tilburg University)

Abstract

This paper discusses the medium- to long-term perspectives for the Irish banking system. Consistent with the finance-growth literature, financial deepening had a limited impact on growth in Ireland before the crisis and cannot be expected to contribute significantly over the short to medium term. The paper documents that, compared to its benchmark, the Irish banking system is still very unbalanced, with a heavy reliance on international funding, and limited competition. Given its membership in the Eurozone and the EU, Ireland depends very much on global and European regulatory reform trends, some of which are more important for Ireland than other European economies. Critically, the shape and resilience of Irish banking will depend on the shape the Eurozone banking union will take.

Suggested Citation

  • Thorsten Beck, 2014. "Ireland's Banking System - Looking Forward," The Economic and Social Review, Economic and Social Studies, vol. 45(1), pages 113-134.
  • Handle: RePEc:eso:journl:v:45:y:2014:i:1:p:113-134
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    References listed on IDEAS

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    1. Jith Jayaratne & Philip E. Strahan, 1996. "The Finance-Growth Nexus: Evidence from Bank Branch Deregulation," The Quarterly Journal of Economics, Oxford University Press, vol. 111(3), pages 639-670.
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    3. Beck Thorsten & Büyükkarabacak Berrak & Rioja Felix K. & Valev Neven T., 2012. "Who Gets the Credit? And Does It Matter? Household vs. Firm Lending Across Countries," The B.E. Journal of Macroeconomics, De Gruyter, pages 1-46.
    4. Hasan, Iftekhar & Koetter, Michael & Wedow, Michael, 2009. "Regional growth and finance in Europe: Is there a quality effect of bank efficiency?," Journal of Banking & Finance, Elsevier, vol. 33(8), pages 1446-1453, August.
    5. Honohan, Patrick, 2009. "Resolving Ireland’s Banking Crisis," The Economic and Social Review, Economic and Social Studies, vol. 40(2), pages 207-231.
    6. Honohan, Patrick, 2006. "To What Extent has Finance been a Driver of Ireland's Economic Success?," Quarterly Economic Commentary: Special Articles, Economic and Social Research Institute (ESRI), pages 59-72.
    7. Felix Rioja & Neven Valev, 2004. "Finance and the Sources of Growth at Various Stages of Economic Development," Economic Inquiry, Western Economic Association International, vol. 42(1), pages 127-140, January.
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    9. Jean Arcand & Enrico Berkes & Ugo Panizza, 2015. "Too much finance?," Journal of Economic Growth, Springer, vol. 20(2), pages 105-148, June.
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    11. Philippe Aghion & Peter Howitt & David Mayer-Foulkes, 2005. "The Effect of Financial Development on Convergence: Theory and Evidence," The Quarterly Journal of Economics, Oxford University Press, pages 173-222.
    12. Beck, Thorsten & Degryse, Hans & Kneer, Christiane, 2014. "Is more finance better? Disentangling intermediation and size effects of financial systems," Journal of Financial Stability, Elsevier, pages 50-64.
    13. Adolfo Barajas & Thorsten Beck & Era Dabla-Norris & Reza Yousefi, 2013. "Too Cold, Too Hot, or Just Right? Assessing Financial Sector Development Across the Globe," IMF Working Papers 13/81, International Monetary Fund.
    14. Büyükkarabacak, Berrak & Valev, Neven T., 2010. "The role of household and business credit in banking crises," Journal of Banking & Finance, Elsevier, vol. 34(6), pages 1247-1256, June.
    15. Asli Demirgüç-Kunt & Enrica Detragiache, 1998. "The Determinants of Banking Crises in Developing and Developed Countries," IMF Staff Papers, Palgrave Macmillan, vol. 45(1), pages 81-109, March.
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    Cited by:

    1. repec:eee:spacre:v:19:y:2016:i:2:p:227-238 is not listed on IDEAS
    2. repec:spr:empeco:v:53:y:2017:i:2:d:10.1007_s00181-016-1142-0 is not listed on IDEAS
    3. Stolbov, Mikhail, 2015. "Causality between credit depth and economic growth: Evidence from 24 OECD countries," BOFIT Discussion Papers 15/2015, Bank of Finland, Institute for Economies in Transition.

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    Keywords

    banking; Eurozone; Ireland;

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