Market concentration, foreign ownership and determinants of bank financial performance: evidence from MENA countries
Article
Elfeituri, H. 2018. Market concentration, foreign ownership and determinants of bank financial performance: evidence from MENA countries. Corporate Ownership and Control. 15 (3), pp. 9-22. https://doi.org/10.22495/cocv15i3art1
Authors | Elfeituri, H. |
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Abstract | The purpose of this paper has been to investigate the market concentration, foreign ownership and profitability for commercial banks operating in the MENA economies over the period 1999-2012. This paper uses panel analysis via GMM estimation to examine a large sample of banks for a period that includes the recent global crisis period and Arab uprising, marked by political changes whilst marked by liberalisation and market transformation. Findings indicate that the SCP hypothesis is not rejected; highlighting that increased market power yields monopoly profits. The fact that the impact of market concentration is positive in MENA economies is vital evidence, at least to a certain extent that bank performance is explained by market concentration. Findings also confirm that there is a positive and significant relationship between profitability and capital adequacy confirming that regulators and policy makers should ensure banks are well capitalised to guarantee survival and stability for MENA banks. Cost efficiency and bank size have decreased profitability of banks and banks with foreign ownership are more profitable and perform better than state banks. Overall, the paper finds evidence of structural reforms and uncovers measures that have led to the improvement of regulation, and the implementation of frameworks which should continue to improve competitiveness within MENA banking sectors. In addition, future policy on the banking sector should take account of intervention to change the market structure and to stimulate competition. |
Journal | Corporate Ownership and Control |
Journal citation | 15 (3), pp. 9-22 |
ISSN | 1727-9232 |
Year | 2018 |
Publisher | Virtus Interpress |
Publisher's version | License |
Digital Object Identifier (DOI) | https://doi.org/10.22495/cocv15i3art1 |
Web address (URL) | https://doi.org/10.22495/cocv15i3art1 |
Publication dates | |
Online | 20 Mar 2018 |
Publication process dates | |
Deposited | 13 Mar 2018 |
Accepted | 01 Mar 2018 |
Accepted | 01 Mar 2018 |
Copyright information | © 2018 Elfeituri |
License | CC BY-NC 4.0 |
https://repository.uel.ac.uk/item/8489v
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