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European Banks and their Impact on the Banking Industry in Chile


  • Ignacio Briones

    (Business School, Universidad Adolfo Ibáñez, Chile)

  • André Villela

    (Escola de Pós-Graduação em Economia, Fundação Getulio Vargas, Brazil)


The history of foreign banks in Chile and Brazil in the late XIXth century and early XXth century is the history of British and German banks. Their penetration in both countries was significant, and not neutral in terms of its impact on the Chilean and Brazilian banking industry. In the main, we found that in both countries foreign banks appear to have had a positive effect at least in some of the dimensions identified by the current literature. However, the extent of this influence is different depending on the country. First, even if a formal banking industry emerged roughly simultaneously in both countries, foreign bank entry in Chile was a more recent phenomenon than in Brazil. Second, while from a financial point of view native and foreign banks in Chile behaved in a relatively similar fashion, in Brazil we observe differences, although a tendency towards convergence was observable by the eve of WWI.

Suggested Citation

  • Ignacio Briones & André Villela, 2006. "European Banks and their Impact on the Banking Industry in Chile," Working Papers 108, Oesterreichische Nationalbank (Austrian Central Bank).
  • Handle: RePEc:onb:oenbwp:108

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    References listed on IDEAS

    1. La Porta, Rafael & Florencio Lopez-de-Silanes & Andrei Shleifer & Robert W. Vishny, 1997. " Legal Determinants of External Finance," Journal of Finance, American Finance Association, vol. 52(3), pages 1131-1150, July.
    2. Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer & Robert W. Vishny, 1998. "Law and Finance," Journal of Political Economy, University of Chicago Press, vol. 106(6), pages 1113-1155, December.
    3. Marco Pagano & Paolo F. Volpin, 2005. "The Political Economy of Corporate Governance," American Economic Review, American Economic Association, vol. 95(4), pages 1005-1030, September.
    4. Julian Franks & Colin Mayer & Stefano Rossi, 2009. "Ownership: Evolution and Regulation," Review of Financial Studies, Society for Financial Studies, vol. 22(10), pages 4009-4056, October.
    5. repec:hrv:faseco:30728041 is not listed on IDEAS
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    Cited by:

    1. Nikolay Nenovsky & Martin Ivanov & Gergana Mihaylova, 2008. "The Evolution of Bulgarian Banks' Efficiency During the Twenties: A Dea Approach," Working Papers 82, Bank of Greece.

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