Foreign Bank Acquisitions and Outreach : Evidence from Mexico

Recently, developing countries have witnessed a sharp increase in foreign bank participation. The authors examine the impact on banking outreach using newly gathered data for Mexico, where foreign bank participation rose from 2 percent to 83 percen...

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Bibliographic Details
Main Authors:	Beck, Thorsten, Martinez Peria, Maria Soledad
Format:	Policy Research Working Paper
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ACCESS TO BANK ACCESS TO CREDIT ACCESS TO FINANCE ACCESS TO FINANCIAL SERVICES ACCOUNTING ACQUISITION ACQUISITION DATES ASSET QUALITY ASSET RATIO ASSET RATIOS ATM ATM PENETRATION ATMS BALANCE SHEET BALANCE SHEETS BANK ACQUISITIONS BANK ASSETS BANK BEHAVIOR BANK BRANCHES BANK COMPETITION BANK CREDIT BANK DEPOSIT BANK LENDING BANK OF CANADA BANK ORIGIN BANK POLICY BANK PRIVATIZATION BANK SERVICES BANK SPREADS BANKING MARKET BANKING SECTOR BANKING SECTOR DEVELOPMENT BANKING SECTOR OUTREACH BANKING SECTORS BANKING SERVICES BANKING STABILITY BANKING SYSTEM BIASES BRANCH NETWORK BUSINESS SCHOOL BUSINESS STRATEGY CAPITAL ACCOUNT CAPITAL ACCOUNT LIBERALIZATION CAPITAL MOBILITY COLLATERAL CONSTANT PRICES CONSUMER CONSUMER FINANCE CONTRACT RIGHTS CONTRIBUTION COST OF CAPITAL COUNTRY COMPARISONS CREDIT ACCESS CREDITS CURRENCY CURRENCY CRISES DEBT DEBT CRISIS DEPOSIT DEPOSIT ACCOUNT DEPOSIT ACCOUNTS DEPOSITS DEVALUATION DEVELOPING COUNTRIES DOMESTIC BANK DOMESTIC BANKING DOMESTIC BANKING MARKETS DOMESTIC BANKS DUMMY VARIABLE DUMMY VARIABLES ECONOMETRICS ECONOMIC CONDITIONS ECONOMIC DEVELOPMENT ECONOMIC GROWTH ECONOMIC POLICY EMERGING MARKET EMERGING MARKETS ENTREPRENEURIAL ACTIVITY EQUITY MARKETS FEDERAL RESERVE FEDERAL RESERVE BANK FEDERAL RESERVE BANK OF BOSTON FEDERAL RESERVE BANK OF NEW YORK FINANCIAL CRISES FINANCIAL CRISIS FINANCIAL GLOBALIZATION FINANCIAL INSTITUTIONS FINANCIAL INTEGRATION FINANCIAL LIBERALIZATION FINANCIAL SECTOR FINANCIAL SERVICES FINANCIAL STABILITY FINANCIAL STATEMENTS FINANCIAL SYSTEM FINANCIAL SYSTEMS FOREIGN BANK FOREIGN BANK ENTRY FOREIGN BANK PARTICIPATION FOREIGN BANK PENETRATION FOREIGN BANKS FOREIGN ENTRY FOREIGN INTERESTS FOREIGN INVESTMENT FOREIGN PENETRATION GEOGRAPHIC ACCESS GOVERNMENT OWNERSHIP GREATER ACCESS GROWTH OPPORTUNITIES HOUSEHOLD ACCESS HOUSEHOLDS INDICATORS OF ACCESS INSIDER LENDING INTEREST RATE INTEREST RATE SPREADS INTERNATIONAL BANK INTERNATIONAL BANKS INTERNATIONAL DEVELOPMENT INVESTMENT BANKS LARGE BANK LARGE BANKS LATIN AMERICAN LEGISLATION LENDERS LEVY LIMITED LOAN LOW-INCOME LOWER INCOME LOWER INTEREST RATE MARKET CONCENTRATION MARKET INTEGRATION MARKET SHARE MERGER MERGERS MUNICIPALITIES MUNICIPALITY NET INTEREST MARGIN NON-PERFORMING LOAN NON-PERFORMING LOANS OPAQUE SMALL BUSINESSES OPERATING COSTS OUTREACH OUTREACH EFFORT OVERHEAD COSTS OWNERSHIP STRUCTURE PRIVATE ENTITIES PRIVATIZATION PROBABILITY PROFITABILITY PROXY PURCHASES RECAPITALIZATION REGRESSION ANALYSIS RESEARCH ASSISTANCE RETAIL BANKS RETURN RETURN ON ASSETS RISK AVERSION RISK MANAGEMENT SAVINGS SAVINGS ACCOUNTS SHARE OF ASSETS SHARE OF BANK ASSETS SMALL BANKS SMALL BUSINESS SMALL BUSINESS FINANCE SMALL COMPANIES SUBSIDIARIES SUPERVISORY AUTHORITY TRADE AGREEMENT TRANSACTION TREATY URBAN AREAS URBANIZATION WHOLESALE BANKS
Online Access:	http://documents.worldbank.org/curated/en/2008/01/9592785/foreign-bank-acquisitions-outreach-evidence-mexico http://hdl.handle.net/10986/6866

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Summary:	Recently, developing countries have witnessed a sharp increase in foreign bank participation. The authors examine the impact on banking outreach using newly gathered data for Mexico, where foreign bank participation rose from 2 percent to 83 percent of assets during 1997-2005. Country-, bank-, and bank-municipality level estimations show a decline in the number of deposit and loan accounts. While country- and bank-level estimations indicate an increase in the share of municipalities with bank branches and in the likelihood of bank presence, bank-municipality regressions show that only rich and urban municipalities benefited. Overall, the evidence is consistent with a decline in outreach.

Foreign Bank Acquisitions and Outreach : Evidence from Mexico

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