Preventing banking sector distress and crises in Latin America

1997 ◽  
Keyword(s):  
Latin America ◽  
Banking Sector

Banking Sector Performance in Latin America: Market Power versus Efficiency

2011 ◽  
Vol 15 (2) ◽  
pp. 307-325 ◽  
Author(s):  
Georgios E. Chortareas ◽  
Jesus G. Garza-Garcia ◽  
Claudia Girardone
Keyword(s):  
Latin America ◽  
Market Power ◽  
Banking Sector ◽  
Sector Performance

scholarly journals Structure, market power, and profitability: evidence from the banking sector in Latin America

2021 ◽  
Vol 32 (85) ◽  
pp. 126-142
Author(s):  
Cristiano Hordones ◽  
Antonio Zoratto Sanvicente
Keyword(s):  
Latin America ◽  
Interest Rates ◽  
Market Structure ◽  
Market Power ◽  
Banking Sector ◽  
Banking Industry ◽  
Scientific Basis ◽  
Performance Model ◽  
Panel Data Regression ◽  
Banking Market

ABSTRACT The aim of this paper is to evaluate the influence of market structure on the competition between banks and to determine whether competition affects their profitability in different countries in Latin America. The study also seeks to compare, between 16 countries in the continent, the levels of concentration, competition, and profitability of the respective banking sectors. This article fills the research gap regarding the structure and market power of banks in emerging countries, by comparing Brazil with the other countries in the continent. The topic is extremely important at a time of debate about the high interest rates in Brazil, the market structure observed, and the alleged effect of this on the high levels of spread between lending and borrowing rates. The research provides evidence for the debate regarding the structure of the banking industry. To evaluate competition, the Panzar-Rosse model was used. Concentration was measured by the Herfindahl-Hirschman index and CR5 ratio. To verify the link between the variables, the hypotheses of the structure-conduct-performance model were tested, via a sample of 16 countries in Latin America, covering the period from 2011 to 2017, using panel data regression. This study, conducted for the banking industry in Latin America, rejected the premises of the structure-conduct-performance (SCP) model, which affirm that concentration reduces competition, causing higher profitability in the sector. In the comparison of the studied variables between the countries in the continent, Brazil presented the lowest competition index. The concentration and profitability assessments, in turn, presented results in line with the mean. The results of the research serve to elucidate the intense debate regarding the structure of the banking market. Moreover, they serve as a scientific basis for regulators’ actions, aiming to incentivize competition and reduce bank spread.

scholarly journals Relations between institutional environment and level of social disclosure in the banking sector: evidence from Latin America

2020 ◽  
Vol 11 (3) ◽  
pp. 158-184
Author(s):  
Alan Bandeira Pinheiro ◽  
Ana Julia Batistella ◽  
Ana Carla Cavalcante das Chagas ◽  
Wendy Witt Haddad Carraro
Keyword(s):  
Latin America ◽  
Banking Sector ◽  
Institutional Environment ◽  
Social Disclosure

scholarly journals A FMOLS Analysis of FDI Flows to Latin America

2019 ◽  
Vol 6 (2) ◽  
pp. 86
Author(s):  
Miguel D. Ramirez
Keyword(s):  
Latin America ◽  
Latin American ◽  
Banking Sector ◽  
Public Investment ◽  
Panel Cointegration ◽  
Ordinary Least Squares ◽  
Real Gdp ◽  
Institutional Determinants ◽  
Cointegration Tests ◽  
Investment Spending

This paper estimates a panel FDI investment function that seeks to identify some of the major economic and institutional determinants of net FDI flows to nine major Latin American countries during the 1980-2014 period. First, it utilizes Dunning’s OLI model to identify some of the major economic and institutional determinants of FDI. Second, the paper provides an overview of FDI flows to Latin America during the 1990-2017 period, with particular emphasis on their contribution to the financing of gross fixed capital formation. Third, an economic rationale is provided for the included variables and their expected signs. Fourth, the paper reports estimates for a Fully Modified Ordinary least Squares (FMOLS) panel regression designed to explain the variation in FDI flows to Latin America during the 1980-2014 period. The estimates suggest that real GDP (a proxy for market size), credit provided by the private banking sector, government expenditures on education, and the level of economic freedom as measured by the Fraser Institute have a positive and significant effect. On the other hand, public investment spending, the volatility of real GDP and the real exchange rate have a negative and significant effect on FDI flows. The panel unit root and (Pedroni) panel cointegration tests suggest that there is a stable, long-term relationship among the included variables; i.e., the selected variables in the reported regressions are cointegrated over the relevant time period.

Foreign banks’ faith in Mexico will endure

2017 ◽  
Keyword(s):  
Latin America ◽  
Commercial Bank ◽  
Banking Sector ◽  
Foreign Bank ◽  
Foreign Banks ◽  
Content Type ◽  
International Banks ◽  
Loan Growth ◽  
Double Digit

Subject Mexican banking. Significance On March 10, Japan's Mizuho launched a commercial bank in Mexico, becoming the latest foreign bank to begin operations there. Mexico's banking sector has been one of the fastest-growing and most attractive in Latin America in recent years, with several new players entering and double-digit loan growth. Impacts Major international banks’ continued interest in Mexico shows confidence in an economy and a government under pressure. Banks that are willing to lend heavily will be important for the struggling Mexican economy. Mexican FDI will benefit from investments by foreign banks despite a predicted fall in FDI overall.

scholarly journals FDI Flows to Latin America: A Pooled and Cointegration Analysis, 1980-2014

2017 ◽  
Vol 7 (2) ◽  
pp. 178
Author(s):  
Miguel D. Ramirez
Keyword(s):  
Latin America ◽  
Latin American ◽  
Fixed Effects ◽  
Banking Sector ◽  
Public Investment ◽  
Cointegration Analysis ◽  
Real Gdp ◽  
Institutional Determinants ◽  
Investment Spending ◽  
Positive Direct

This paper estimates a pooled (fixed-effects) FDI investment function that seeks to identify some of the major economic and institutional determinants of net FDI flows to nine major Latin American countries during the 1980-2014 period. First, it develops a conceptual framework of analysis that seeks to identify some of the major economic and institutional determinants of FDI. Second, the paper gives an overview of FDI flows to Latin America during the 1990-2015 period, with particular emphasis on their contribution to the financing of gross capital formation. Third, an empirical model for FDI flows to Latin America is outlined and an economic rationale is provided for the included variables and their expected signs. Fourth, the estimates from a panel regression designed to explain the variation in FDI flows to Latin America during the 1980-2014 period suggests that market size (proxied by real GDP), credit provided by the private banking sector, government expenditures on education, and the level of economic freedom as measured by the Fraser Institute have a positive and significant effect. On the other hand, public investment spending, the volatility of real GDP and the real exchange rate have a negative and significant effect on FDI flows. The panel unit root tests on the residuals of the relevant panel regressions also suggest that there is a stable, long-term relationship among the included variables; i.e., the selected variables in the reported regressions are cointegrated over the relevant time period. Finally, the paper summarizes the major findings and offers some policy prescriptions for attracting FDI flows to the region and enhancing their positive direct and indirect effects. 

COVID-19 crisis will interrupt Dominican GDP growth

2020 ◽  
Keyword(s):  
Latin America ◽  
Dominican Republic ◽  
Banking Sector ◽  
Target Range ◽  
Caribbean Region ◽  
Gdp Growth ◽  
Content Type ◽  
Financing Gap ◽  
Low Levels ◽  
The Government

Subject The Dominican Republic and COVID-19. Significance Unlike much of the Latin America/Caribbean region, the Dominican Republic faces the COVID-19 pandemic from a position of macroeconomic strength and stability. Growth lost pace in 2019 but was still robust at 5.1%, while inflation stayed within the Central Bank target range, at 3.7%. The banking sector remains well capitalised with non-performing loans at low levels (1.6%) at the end of last year. Impacts If the financing gap persists, the government will seek further credit in the markets, despite having to bear increasing yields. The general election will probably be postponed beyond July, with opposition candidate Luis Abinader likely to remain the frontrunner. An ongoing exodus of Haitians will continue, with unscreened incomers increasing contagion risks in Haiti.

The Genesis and Internal Dynamics of El Salvador's People's Revolutionary Army, 1970–1976

2014 ◽  
Vol 38 (01) ◽  
pp. 102-129
Author(s):  
ALBERTO MARTÍN ÁLVAREZ ◽  
EUDALD CORTINA ORERO
Keyword(s):  
Latin America ◽  
El Salvador ◽  
Early Years ◽  
Left Wing ◽  
Internal Dynamics ◽  
Internal Coherence ◽  
The 1960S

AbstractUsing interviews with former militants and previously unpublished documents, this article traces the genesis and internal dynamics of the Ejército Revolucionario del Pueblo (People's Revolutionary Army, ERP) in El Salvador during the early years of its existence (1970–6). This period was marked by the inability of the ERP to maintain internal coherence or any consensus on revolutionary strategy, which led to a series of splits and internal fights over control of the organisation. The evidence marshalled in this case study sheds new light on the origins of the armed Salvadorean Left and thus contributes to a wider understanding of the processes of formation and internal dynamics of armed left-wing groups that emerged from the 1960s onwards in Latin America.

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