We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
The Determinants of the Exit Decisions of Foreign Banks.
- Authors
Hryckiewicz, Aneta; Kowalewski, Oskar
- Abstract
This paper examines the determinants influencing multinational banks' decisions to exit a foreign market in the years 1999-2006. Using binary response models, we find that parent banks that closed a foreign operation reported significant financial weakness prior to the exit decision. We also show that the decisions of the parent banks were not caused primarily by the performance of the foreign banks' subsidiaries. Consequently, we document that the exit decisions were a result of financial problems of the parent banks in their home markets. This finding supports the need for global bank supervision, showing that it is important to monitor both the parent bank and its foreign subsidiary. The results also provide evidence that the recent financial crisis may change the ownership structure and the level of foreign ownership in the banking systems in many countries around the world.
- Subjects
FOREIGN subsidiaries; STOCK ownership; FINANCIAL performance; PARENT companies; TRACKING stock; GLOBAL Financial Crisis, 2008-2009; ASSET allocation; INTERNATIONAL markets
- Publication
Banking & Finance Review, 2010, Vol 2, Issue 2, p53
- ISSN
1947-7945
- Publication type
Article