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How the internet affects the financial performance of Greek banks

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  • Georgia Giordani
  • Christos Floros

Abstract

This paper examines how the internet affects the financial performance of Greek banks. Using econometric models, we examine the degree to which internet has contributed to an improvement in their profitability. Our findings suggest that the adoption of internet as a banking delivery channel has no effect on the profitability of banks in terms of the ROA and the ROE financial ratios. We show that there is a reduction in the net interest margin ratio, implying a decrease in the profits gained from the interest on loans after the deduction of the interest paid to lenders. In addition, we find that there is a decrease in the net interest revenue over average assets. Moreover, our findings suggest a reduction in the operational expenses for the banks adopting internet banking. Finally, we report that assets, net loans over total assets, and equities over total assets are unaffected by the internet banking. These results are strongly recommended to managers dealing with internet technology and banking adoption.

Suggested Citation

  • Georgia Giordani & Christos Floros, 2013. "How the internet affects the financial performance of Greek banks," International Journal of Financial Services Management, Inderscience Enterprises Ltd, vol. 6(2), pages 170-177.
    • Handle: RePEc:ids:ijfsmg:v:6:y:2013:i:2:p:170-177
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    Cited by:

    1. Elisa Di Febo & Eliana Angelini, 2022. "Internet banking, age, gender, and performance: Which connections in Italy?," Bank i Kredyt, Narodowy Bank Polski, vol. 53(3), pages 295-324.
    2. Tariq Abbasi & Hans Weigand, 2017. "The Impact of Digital Financial Services on Firm's Performance: a Literature Review," Papers 1705.10294, arXiv.org.

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