Does bank competition lead to financial stability?: A comparative study between the Philippines and Thailand from 2000 to 2006

Date of Publication

2010

Document Type

Bachelor's Thesis

Degree Name

Bachelor of Science in Commerce Major in Management of Financial Institutions

Subject Categories

Finance and Financial Management

College

Ramon V. Del Rosario College of Business

Department/Unit

Financial Management

Thesis Adviser

Junette A. Perez

Defense Panel Member

Ciara Sapalaran
Rene Betita
Manrico Masagca

Abstract/Summary

There are two competing theories on the effect of bank competition on financial stability, competition-fragility view and competition-stability view. The group hypothesizes that competition does not lead to financial stability. This is tested through regressing measures of loan risk, bank risk and equity capital on several market power indicators. The Generalized Method of Moments estimation is used to control for possible endogeneity of measures of the degree of market power. This study departs from the existing literature focusing on developed countries by comparing twenty banks from the Philippines and from Thailand. Data utilized are from the individual bank's annual reports and the OSIRIS database from the 2000 to 2006. Results reveal that the Philippines support the competition-stability view while Thailand supports competition-fragility view.

Abstract Format

html

Language

English

Format

Print

Accession Number

TU21201

Shelf Location

Archives, The Learning Commons, 12F, Henry Sy Sr. Hall

Physical Description

133 leaves

Keywords

Banks and banking--Philippines; Banks and banking--Thailand

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