La concentración histórica del sistema bancario mexicano: estructura y ciclos

This paper analyzes the evolution of industrial concentration in the Mexican banking system from the Porfirian era to the present. Although concentration is persistent, cycles of expansion and of consolidation can be distinguished throughout history. Some of the expansion and consolidation processes have been promoted by financial authorities, but episodes of exogenous shocks—such as crises—also determine consolidation cycles. The article describes that an important factor in explaining the persistence of concentration, as well as the market share of large banks, is the investment of banks in distribution network infrastructure. While over time there has been a narrative linking concentration with competition, this article does not address potential competition issues but instead studies concentration as a structural characteristic of the industry. The article emphasizes the last two decades, in which, although the concentration in the largest financial institutions persists, the entry of new intermediaries has led to diminishing market concentration.