Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/29556
Authors: 
Uhde, André
Heimeshoff, Ulrich
Year of Publication: 
2009
Series/Report no.: 
IWQW discussion paper series 02/2009
Abstract: 
Using aggregate balance sheet data from banks across the EU-25 over the period from 1997 to 2005 this paper provides empirical evidence that national banking market concentration has a negative impact on European banks' financial soundness as measured by the Z-score technique while controlling for macroeconomic, bank-specific, regulatory, and institutional factors. Furthermore, we find that Eastern European banking markets exhibiting a lower level of competitive pressure, fewer diversification opportunities and a higher fraction of government-owned banks are more prone to financial fragility whereas capital regulations have supported financial stability across the entire European Union.
Subjects: 
Market structure
Financial stability
Banking regulation
JEL: 
G21
G28
G34
L16
Document Type: 
Working Paper

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