Bank Consolidation, Internationalization,and Conglomeration: [View All]

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IMF Working Paper 2003

The views expressed in this Working Paper are those of the aulhor(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate.

Abstract

This paper documents global trends in bank activity, consolidation, internationalization, and financial firm conglomeration, and explores the extent to which financial firm risk and systemic risk potential in banking are related to consolidation and conglomeration. We find that while there is a substantial upward trend in conglomeration globally, consolidation and internationalization exhibit uneven patterns across world regions. Trends in consolidation and conglomeration indicate increased risk profiles for large, conglomerate financial firms, andhigher levels of systemic risk potential for more concentrated banking systems. We outline research directions aimed at explaining why bank consolidation and conglomeration do notnecessarily yield either safer financial firms or more resilient banking systems


http://www.imf.org/external/pubs/ft/wp/2003/wp03158.pdf