Bank competition, regulation, and efficiency: evidence from the Asia-Pacific region. Issue 3 (4th May 2022)

• Record Type: Journal Article
• Authors: Li, Shaofang; Li, Xiaolin
• Is Part Of: Asia-Pacific journal of accounting & economics. Volume 29:Issue 3(2022)
• Page Start: 715
• Page End: 742
• Publication Date: 2022-05-04
• Subjects: Bank competition -- regulation -- profit and cost efficiency -- Asia-Pacific region; Accounting -- Periodicals; Accounting -- Pacific Area -- Periodicals; Economics -- Periodicals; Pacific Area -- Economic conditions -- Periodicals; 657
• DOI: 10.1080/16081625.2020.1787854
• Languages: English
• ISSNs: 1608-1625

Abstract

ABSTRACT: This study investigates the impact of bank competition and regulation on bank efficiency in the Asia-Pacific region during 2001–2016. The result reveals that market power is positively related to bank efficiency. We also find that stringent activity restrictions, strong official supervisory power, and low capital requirements are associated with high bank efficiency. Furthermore, market power has a stronger efficiency-increasing effect in a banking system characterized by the activity restrictions, supervisory power, and capital requirements described above. Foreign banks operating under increased activity restrictions in a host country with strong official supervisory power have relatively high efficiency.