We estimate the effect of the distribution of banks by asset size on a country’s propensity to engage in cross-border banking. Countries where the distribution of banks by asset size is more skewed to the right (with few large and many small banks) lend more abroad and are recipients of more funds from foreign banks. This is consistent with the fact that large banks, with easier access to the international financial markets, act as a hub for smaller banks and at the same time stand out as safer too-big-to fail counterparts for foreign partners.

Few Large with Many Small : Banks Size Distribution and Cross-Border Financial Linkages / G. Barba Navaretti, G. Calzolari, A.F. Pozzolo, M.T. Trentinaglia. - In: JOURNAL OF FINANCIAL SERVICES RESEARCH. - ISSN 1573-0735. - 56:3(2019 Dec 01), pp. 229-258.

Few Large with Many Small : Banks Size Distribution and Cross-Border Financial Linkages

G. Barba Navaretti
;
M.T. Trentinaglia
2019

Abstract

We estimate the effect of the distribution of banks by asset size on a country’s propensity to engage in cross-border banking. Countries where the distribution of banks by asset size is more skewed to the right (with few large and many small banks) lend more abroad and are recipients of more funds from foreign banks. This is consistent with the fact that large banks, with easier access to the international financial markets, act as a hub for smaller banks and at the same time stand out as safer too-big-to fail counterparts for foreign partners.
Bank size; BIS International banking statistics; Gravity equations
Settore SECS-P/01 - Economia Politica
1-dic-2019
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/2434/674076
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