816Sturm and Williams (2003) have investigated impact of foreign bank entry on bankingefficiency in Australia during the post-deregulation period 1988-2001. The researchers haveapplied Data Envelopment Analysis, Malmquist Indices and stochastic frontier analysis andreported foreign banks more efficient than domestic banks, which however did not result insuperior profits
.Dages and et all. (2000) have sought to contribute to the debate on financial sectoropenness in emerging markets by reviewing the experiences of Mexico and Argentina withregard to foreign bank local lending. They have reported that in both countries, foreign banksexhibited stronger loan growth than all domestically owned banks and had lower associatedvolatility, contributing to greater stability in overall financial system credit. Additionally, inboth countries, foreign banks showed notably credit growth during economic crises periodsand thereafter. They claim that bank health, and not ownership per se, has been the criticalelement in the growth, volatility, and cyclicality of bank credit. They also assert diversity inownership has contributed to greater stability of credit and financial system weakness
.Haselmann (2006) has investigated foreign banks effect on transition countries andreports that the high market share of foreign banks in transition economies have a positiveeffect. The researcher also reports that foreign banks play a stabilizing role in the creditmarkets and hold onto their credit base during periods of financial instability. Thus, there isno evidence for financial fragility caused by foreign banks
.Craft and et all (2006) have investigated privatization, foreign bank entry and bankefficiency in Croatia for 1994 to 2000. To achieve this, the researchers have estimated aFourier-flexible frontier cost function. They report that new private and privatized banks,contrary to some expectations, are not the most efficient banks through most of the period.Privatization also has not an immediate effect on improved efficiency. Foreign banks havesubstantially better efficiency scores than all categories of domestic banks
Sturm Jan Egbert and Barry Williams,
Foreign bank entry, deregulation and bank efficiency: Lessons fromthe Australian experince,
Journal of Banking & Finance 28 (2004), pp. 1775–1799
Dages B. Gerardi Linda Goldberg and Daniel Kinney,
Foreign and domestic bank participation in emergingmarkets: Lessons from Mexico and Argentine,
Economic and Policy Review, 2000, 6, 3, pp. 17-36.
Strategies of foreign banks in transition economies,
Emerging Market Review, 2006,Vol:7, issue:4, pp. 283-299.
Kraft Evan, Richard Hoffler and James Payne,
Privatization, foreign bank entry and bank efficiency inCroatia: A Fourier-flexible function stochastic cost frontier analysis,
Applied Economics, 2006, Vol: 38, pp.2075-2088.