IDEAS home Printed from https://ideas.repec.org/b/erf/erfstu/18.html
   My bibliography  Save this book

Banking Internationalisation and the Expansion Strategies of European Banks to Brazil during the 1990s

Editor

Listed:
  • Morten Balling
    ()

Author

Listed:
  • Luiz Fernando de Paula

Abstract

This paper aims at analysing the determinants of the recent wave of European banks to Brazil under the context of the recent phase of banking internationalisation. In its first part, it analyses the process of banking internationalisation from both analytical and historical approach. Focusing on the determinants of the banking internationalisation process, the paper shows that (i) the recent wave of banking internationalisation is characterised not only for financial institutions following their existing relationships, but also and increasingly by a greater integration with the local market; (ii) banks operating in countries where the banking sector is larger and more profitable should be able to export a superior skill and are more likely to expand their activities abroad. The second part of the paper examines the determinants of the expansion of European banks in Brazil, as well as the expansion strategy of the four major European banks in Latin America - BSCH, BBVA, HSBC and ABN-Amro. In this regard, it shows that the recent wave of European banks entering Latin America and Brazil is determined by a set of different factors, that includes the process of restructuring the banking sector under the EMU; the dynamics of the internationalisation of the Spanish banks, since they have been the main players in the recent influx of foreign banks into Latin America; the process of market deregulation in the region since early 1990s, in the broader context of economic and political reforms; the better prospects of the region for increasing returns to financial institution compared to developed countries, as well as the potential gains in efficiency. Besides, it also shows that one of the common features of the four major European banks in Latin America - BSCH, BBVA, HSBC and ABN-Amro - is that all the top 4 are big universal banks that choose to expand abroad as a strategy to expand their activities. More precisely, expanding abroad is not only a source of diversification of earnings, but also a way to strengthen their position in the European banking market under the pressure of economic and monetary union.

Suggested Citation

  • Luiz Fernando de Paula, 2002. "Banking Internationalisation and the Expansion Strategies of European Banks to Brazil during the 1990s," SUERF Studies, SUERF - The European Money and Finance Forum, number 18 edited by Morten Balling.
  • Handle: RePEc:erf:erfstu:18
    as

    Download full text from publisher

    File URL: http://www.suerf.org/docx/o_766ebcd59621e305170616ba3d3dac32_587_suerf.pdf
    File Function: Main Text
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Willem Buiter & Clemens Grafe, 2001. "Central Banking and the Choice of Currency Regime in Accession Countries," Revue d'Économie Financière, Programme National Persée, vol. 6(1), pages 287-318.
    2. Thomas Reininger & Franz Schardax & Martin Summer, 2002. "Financial System Transition in Central Europe: The First Decades," SUERF Studies, SUERF - The European Money and Finance Forum, number 16 edited by Morten Balling.
    3. Cem Karacadag & Michael W. Taylor, 2000. "The New Capital Adequacy Framework - Institutional Constraints and Incentive Structures," SUERF Studies, SUERF - The European Money and Finance Forum, number 8 edited by Morten Balling.
    4. Alexandre Lamfalussy, 2001. "Reflections on the Regulation of European Securities Markets," SUERF Studies, SUERF - The European Money and Finance Forum, number 14 edited by Morten Balling.
    5. Helmut Wagner, 2002. "Implications of Globalization for Monetary Policy," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    6. David Llewellyn, 1999. "The New Economics of Banking," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    7. Joseph Bisignano, 1998. "Towards an Understanding of the Changing Structure of Financial Intermediation - An Evolutionary Theory of Institutional Survival," SUERF Studies, SUERF - The European Money and Finance Forum, number 4 edited by Morten Balling.
    8. M.M.G. Fase & W.F.V. Vanthoor, 2000. "The Federal Reserve System Discussed: A Comparative Analysis," SUERF Studies, SUERF - The European Money and Finance Forum, number 10 edited by Morten Balling.
    9. Helmut Wagner, 2002. "Implications of Globalization for Monetary Policy," SUERF Studies, SUERF - The European Money and Finance Forum, number 17 edited by Morten Balling.
    10. Joseph Bisignano, 1998. "Towards an Understanding of the Changing Structure of Financial Intermediation: An Evolutionary Theory of Institutional Survival," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    11. M.M.G. Fase, 2001. "Investments in Painting: The interaction of monetary return and psychic income," SUERF Studies, SUERF - The European Money and Finance Forum, number 13 edited by Morten Balling.
    12. Alexandre Lamfalussy, 2001. "Reflections on the Regulation of European Securities Markets," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    13. Sanjiva Prasad & Christopher J. Green & Victor Murinde, 2001. "Company Financing, Capital Structure, and Ownership: A Survey, and Implications for Developing Economies," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    14. Rolf Skog, 1997. "Does Sweden Need a Mandatory Bid Rule? A critical analysis," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    15. Peter R Haiss & Gerhard Fink, 1998. "Seven Years of Financial Market Reform in Central Europe," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    16. G.M.M. Gelauff & C. den Broeder, 1997. "Governance of stakeholder relationships - The German and Dutch experience," SUERF Studies, SUERF - The European Money and Finance Forum, number 1 edited by Morten Balling.
    17. John Hawkins & Dubravko Mihaljek, 2001. "The banking industry in the emerging market economies: competition, consolidation and systemic stability: an overview," BIS Papers chapters,in: Bank for International Settlements (ed.), The banking industry in the emerging market economies: competition, consolidation and systemic stability, volume 4, pages 1-44 Bank for International Settlements.
    18. Rolf Skog, 1997. "Does Sweden Need a Mandatory Bid Rule? - A Critical Analysis," SUERF Studies, SUERF - The European Money and Finance Forum, number 2 edited by Morten Balling.
    19. Bank for International Settlements, 2001. "The banking industry in the emerging market economies: competition, consolidation and systemic stability," BIS Papers, Bank for International Settlements, number 04.
    20. David T. Llewellyn, 1999. "The New Economics of Banking," SUERF Studies, SUERF - The European Money and Finance Forum, number 5 edited by Morten Balling.
    21. Mauro F. Guillén & Adrian E. Tschoegl, 1999. "At Last the Internationalization of Retail Banking? The Case of the Spanish Banks in Latin America," Center for Financial Institutions Working Papers 99-41, Wharton School Center for Financial Institutions, University of Pennsylvania.
    22. John Calverley & Sarah Hewin & Kevin Grice, 2000. "Emerging Stock Markets After the Crisis," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    23. George Gelauff & Corina den Broeder, 1997. "Governance of stakeholder relationships: The German and Dutch experience," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Alfred Janc & Pawel Marszalek, 2015. "Effects of internationalization, privatisation and demutualization of the financial sector on supply of finance and stability," Working papers wpaper119, Financialisation, Economy, Society & Sustainable Development (FESSUD) Project.
    2. Paula Bongini, 2003. "The EU Experience in Financial Services Liberalization: A Model for GATS Negotiations?," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    3. Thomas Dalsgaard & Jørgen Elmeskov & Cyn-Young Park, 2002. "Ongoing Changes in the Business Cycle – Evidence and Causes," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    4. Christian Harm, 2002. "Bank management between shareholders and regulators," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    5. Bert Scholtens & Dick van Wensveen, 2003. "The Theory of Financial Intermediation: An Essay On What It Does (Not) Explain," SUERF Studies, SUERF - The European Money and Finance Forum, number 2003/1 edited by Morten Balling.
    6. Jean-Paul Abraham & Peter Van Dijcke, 2002. "European Financial Cross-Border Consolidation: At the crossroads in Europe? By exception, evolution or revolution?," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.

    More about this item

    Keywords

    multinational banks; European banks; banking internationalisation; Brazil;

    JEL classification:

    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:erf:erfstu:18. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dragana Popovic). General contact details of provider: http://edirc.repec.org/data/suerfea.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.