Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/264772 
Year of Publication: 
2012
Series/Report no.: 
Working Paper No. 180
Publisher: 
Oesterreichische Nationalbank (OeNB), Vienna
Abstract: 
We examine the impact of changes in the financial structure of the Austrian banking sector over the past 15 years, such as disintermediation, internationalization and privatization, on the profitability of banks. Several proxies based on bank balance sheet data at the micro level as well as macroeconomic variables are used to capture these changes. The case of Austria is particularly interesting because country-specific developments, such as the opening-up of the banking sector due to EU accession, coincided with the global deregulation of banking activities. Our estimation results, which are based on dynamic panel regression methods, indicate that disintermediation (a lower percentage of loans over total assets) and higher market concentration in the banking sector had a positive effect on bank profitability, while, surprisingly, changes in the ownership structure (privatization and increased foreign ownership) as well as more foreign lending by Austrian banks did not have a clear-cut or significant impact on bank profits.
Subjects: 
Bank Profitability
Banking Market Structure
Dynamic Panel Estimation
JEL: 
G21
E44
D40
G32
C33
Document Type: 
Working Paper

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