Ultimate ownership and bank competition

José Azar; Sahil Raina; Martin Schmalz

doi:10.1111/fima.12368

journal article Jun 29, 2021

Ultimate ownership and bank competition

José Azar Sahil Raina Martin Schmalz

Financial Management Vol. 51 No. 1 pp. 227-269 · Wiley

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Abstract

AbstractWe document substantial time‐series and cross‐sectional variation in branch‐level deposit account interest rates, maintenance fees, and fee thresholds, and examine whether variation in bank concentration helps explain variation in these prices. Herfindahl–Hirschman Index (HHI) alone is not correlated with any of the outcome variables. A “generalized HHI” (GHHI) capturing both common ownership (the degree to which banks are commonly owned by the same investors) and cross‐ownership (the extent to which banks own shares in each other), is strongly correlated with all prices, even when we limit cross‐sectional variation in bank ownership to only that predicted by the growth of index funds.

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Metrics

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Citations

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References

Details

Published: Jun 29, 2021
Vol/Issue: 51(1)
Pages: 227-269
License: View

Authors

J

José Azar

School of Economics and Business University of Navarra, Barcelona Spain; IESE Business School University of Navarra Barcelona Spain

S

Sahil Raina

Alberta School of Business University of Alberta, Edmonton Alberta Canada

M

Martin Schmalz

Saïd Business School University of Oxford Oxford UK; CEPR London UK; ECGI Brussels Belgium

Cite This Article

José Azar, Sahil Raina, Martin Schmalz (2021). Ultimate ownership and bank competition. Financial Management, 51(1), 227-269. https://doi.org/10.1111/fima.12368

Ultimate ownership and bank competition

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