Naslov
Efficiency Determinants and Regulatory Impact on Banking Operations in the EU

Autori
Gržeta, Ivan

Vrsta, podvrsta i kategorija rada
Ocjenski radovi, doktorska disertacija

Fakultet
Ekonomski fakultet

Mjesto
Rijeka

Datum
25.11

Godina
2019

Stranica
198

Mentor
Žiković, Saša

Ključne riječi
European Union, bank regulation and supervision, bank profitability, bank efficiency

Sažetak
Strong banking regulation and supervision creates a stable and secure banking environment with the aim of avoiding the negative effects that bank failure can have on the overall economy. However, the impact of the banking regulatory framework remains a much- researched topic since its refinements and changes have significant implications for the operations of individual banks. The latest regulatory framework introduced globally in the form of Basel 3 and its implementation into the legislation of EU Member States has aroused interest in identifying the determinants of efficiency, as well as in analysing the impact of regulation on banks' operations, i.e. its impact on their efficiency and profitability. The aim of this doctoral dissertation is to show how, depending on size, the relative efficiencies of commercial banks differ across EU countries, and to analyse the impact of the latest regulatory framework on the efficiency and profitability of commercial banks in the European Union (EU28). The analysis was conducted on the basis of 433 commercial banks from all European countries, over the period from 2006 until 2015. The impact of the new regulatory framework on the banking industry (Basel implementation in EU legislation) was conducted in 2-stage analysis. In the first stage, the relative efficiency was calculated based on the widely used non-parametric Data Envelopment Analysis method. Since most economic variables exhibit dynamic behaviour, the second phase, or the impact of regulation on banks' operations, is performed using dynamic panel data. The results of the analysis of relative efficiency show that relative efficiencies differ significantly among the countries of the European Union, and that significant differences are also visible in the relative efficiencies of banks depending on their size. An analysis of the impact of regulation on bank operations shows interesting results. Namely, regulation negatively affects the efficiency of all banks, regardless of their size, has no significant impact on the profitability of large and medium-sized banks, while the impact on the profitability of small banks is negative and significant. Such results suggest that large and medium-sized banks have skilfully adapted to the new regulatory environment because, although their efficiency has been reduced, the impact on their profitability is absent. Small banks, on the other hand, suffer from a decline in their efficiency, as well as a decline in profitability, which certainly leads to their closure or merger with larger banks. Such a trend is worrying as it leads to greater concentration of the banking sector. This doctoral dissertation contributes to the existing literature regarding the impact of regulation on the efficiency and profitability of banks, and the conclusion that regulation should not be implemented in same way to all banks, that is, a distinction should be made between smaller and larger banks.

Izvorni jezik
Engleski

Znanstvena područja
Ekonomija

POVEZANOST RADA