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Foreign Banks in Croatia: Reasons for Entry, Performance and Impacts

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  • Evan Kraft

    (Croatian National Bank, Trg Hrvatskih Velikana 3, 10002, Zagreb, Croatia, evan.kraft@hnb.hr)

Abstract

Foreign banks’ share in Croatia jumped from less than 10 per cent in 1998 to about 90 per cent of total banking assets after 2000. Survey data indicate that pull factors were strong. Foreign banks are perceived to have strong impacts on the level of competition and the quality of products and services. Heavily involved in broad retail and wholesale markets, foreign banks express strong interest in lending to small and medium enterprises. Balance sheet and income statement data show that de novo foreign banks in particular have had higher levels of cost efficiency, asset quality, reliance on borrowed funds, and credit growth.

Suggested Citation

  • Evan Kraft, 2004. "Foreign Banks in Croatia: Reasons for Entry, Performance and Impacts," Journal of Emerging Market Finance, Institute for Financial Management and Research, vol. 3(2), pages 153-174, August.
    • Handle: RePEc:sae:emffin:v:3:y:2004:i:2:p:153-174
    DOI: 10.1177/097265270400300204
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    References listed on IDEAS

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    Cited by:

    1. Kraft, Evan & Galac, Tomislav, 2011. "Macroprudential regulation of credit booms and busts -- the case of Croatia," Policy Research Working Paper Series 5772, The World Bank.
    2. Koutsomanoli-Filippaki, Anastasia & Margaritis, Dimitris & Staikouras, Christos, 2009. "Efficiency and productivity growth in the banking industry of Central and Eastern Europe," Journal of Banking & Finance, Elsevier, vol. 33(3), pages 557-567, March.
    3. Predrag Četković, 2015. "The Role of Banks in Economic Development in the Former SFR Yugoslavia," wiiw Balkan Observatory Working Papers 114, The Vienna Institute for International Economic Studies, wiiw.
    4. Kraft, Evan & Jankov, Ljubinko, 2005. "Does speed kill? Lending booms and their consequences in Croatia," Journal of Banking & Finance, Elsevier, vol. 29(1), pages 105-121, January.
    5. Sichong Chen & Muhammad Imran Nazir & Shujahat Haider Hashmi & Ruqia Shaikh, 2019. "Bank Competition, Foreign Bank Entry, and Risk-Taking Behavior: Cross Country Evidence," JRFM, MDPI, vol. 12(3), pages 1-26, June.

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