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Banking reform in transition countries

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  • Stijn Claessens

Abstract

An important debate about financial reform in transition economies is whether or not governments should try to rehabilitate existing state-owned banks or allow a new or parallel banking system to emerge. A comparison of institutional development of banks in twenty-five transition countries suggests that more rapid progress can be made with the entry of new banks as opposed to rehabilitation, especially relative to initial conditions. In most countries, however, a cadre of weak banks still exists. Regression estimates suggest that the progress of these weak banks is inhibited by poor troubled-bank intervention, preferential treatment and limited entry.

Suggested Citation

  • Stijn Claessens, 1998. "Banking reform in transition countries," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 2(2), pages 115-133.
  • Handle: RePEc:taf:jpolrf:v:2:y:1998:i:2:p:115-133
    DOI: 10.1080/13841289808523377
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    Cited by:

    1. Giovanni Ferri, 2008. "Banking In China: Are New Tigers Supplanting the Mammoths?," Working Papers 052008, Hong Kong Institute for Monetary Research.
    2. Laszlo Tihanyi & W. Harvey Hegarty, 2007. "Political Interests and the Emergence of Commercial Banking in Transition Economies," Journal of Management Studies, Wiley Blackwell, vol. 44(5), pages 788-813, July.
    3. David A Grigorian & Vlad Manole, 2006. "Determinants of Commercial Bank Performance in Transition: An Application of Data Envelopment Analysis," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 48(3), pages 497-522, September.
    4. Lino Sau, 2012. "Evolution of China's financial system and its impact on economic development," International Journal of Economic Policy in Emerging Economies, Inderscience Enterprises Ltd, vol. 5(1), pages 1-15.
    5. van Soest, A.H.O. & Peresetsky, A. & Karminsky, A.M., 2003. "An Analysis of Ratings of Russian Banks," Other publications TiSEM 5b60e672-da50-41be-af9c-a, Tilburg University, School of Economics and Management.
    6. Park, Albert & Brandt, Loren & Giles, John, 2003. "Competition under credit rationing: theory and evidence from rural China," Journal of Development Economics, Elsevier, vol. 71(2), pages 463-495, August.
    7. Delis, Manthos D & Staikouras, Panagiotis, 2009. "On-site audits, sanctions, and bank risk-taking: An empirical overture towards a novel regulatory and supervisory philosophy," MPRA Paper 16836, University Library of Munich, Germany.
    8. P. Honohan, 2000. "Banking System Failures in Developing and Transition Countries: Diagnosis and Prediction," Economic Notes, Banca Monte dei Paschi di Siena SpA, vol. 29(1), pages 83-109, February.
    9. Dastan ASEİNOV & Kamalbek KARYMSHAKOV, 2018. "Development of the Banking System in Kyrgyzstan: An Historical Review and Current Challenges," Sosyoekonomi Journal, Sosyoekonomi Society.
    10. Montes-Negret, Fernando & Papi, Luca, 1997. "The Polish experience with bank and enterprise restructuring," Policy Research Working Paper Series 1705, The World Bank.
    11. Fleming, Alex & Lily Chu & Bakker, Marie-Renee, 1996. "The Baltics - Banking crises observed," Policy Research Working Paper Series 1647, The World Bank.
    12. Пересецкий А.А. & Карминский А.М. & Ван Суст А.Г.О., 2004. "Моделирование Рейтингов Российских Банков," Журнал Экономика и математические методы (ЭММ), Центральный Экономико-Математический Институт (ЦЭМИ), vol. 40(4), октябрь.
    13. Ferri, Giovanni, 2009. "Are New Tigers supplanting Old Mammoths in China's banking system? Evidence from a sample of city commercial banks," Journal of Banking & Finance, Elsevier, vol. 33(1), pages 131-140, January.
    14. Preslava Kovatchevska, 2000. "The Banking and Currency Crises in Bulgaria: 1996 - 1997," CASE Network Studies and Analyses 0204, CASE-Center for Social and Economic Research.
    15. Luc Can & Mohamed Ariff, 2009. "Performance of East Asian banking sectors under IMF-supported programs," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 14(1), pages 5-26.
    16. Gérard Duchêne & Ramona Jimborean & Boris Najman, 2006. "Structure of Monetary Assets in Transition Economies: Financial Innovation and Structural Transformation," Post-Print hal-00270544, HAL.
    17. Babasyan, Davit & Gu, Yunfan & Melecky, Martin, 2023. "Late banking transitions: Comparing Uzbekistan to earlier reformers," World Development Perspectives, Elsevier, vol. 30(C).
    18. Patrick Honohan, 1998. "Diagnosing Banking System Failures in Developing Countries," Papers WP093, Economic and Social Research Institute (ESRI).
    19. Matovnikov Mikhail, 2003. "The ups and downs of banking system in transition," EERC Working Paper Series 99-244e, EERC Research Network, Russia and CIS.

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