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Determinants of Bilateral Operations of Canadian and US Commercial Banks

Author

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  • J W Harrington Jr

    (The Institute of Public Policy, George Mason University, Fairfax, VA 22030, USA)

Abstract

The size of parent bank has been found to be the chief determinant of commercial banks' foreign operations. A framework is developed for explaining this, as well as other aspects of the source, nature, host country, and subnational location of foreign-owned and foreign-affiliated bank offices. In the Canada-US context, the posited relationships are complicated by the two economies' proximity and intensive interaction, and by regulatory changes within and between the countries. The paper refers to published data and personal interviews to note the influence that proximity, ultimate ownership, and market segmentation have on banks' decisions to engage in correspondent relationships versus agencies, branches, or subsidiaries across the border. From the interviews and by using the hypothesized framework, the author also explores relationships between existing bank strengths and changes resulting from the bilateral Free Trade Agreement.

Suggested Citation

  • J W Harrington Jr, 1992. "Determinants of Bilateral Operations of Canadian and US Commercial Banks," Environment and Planning A, , vol. 24(1), pages 137-151, January.
    • Handle: RePEc:sae:envira:v:24:y:1992:i:1:p:137-151
    DOI: 10.1068/a240137
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    References listed on IDEAS

    as
    1. Gray, Jean M. & Gray, H. Peter, 1981. "The multinational bank: A financial MNC?," Journal of Banking & Finance, Elsevier, vol. 5(1), pages 33-63, March.
    2. repec:bla:econom:v:38:y:1971:i:149:p:1-27 is not listed on IDEAS
    3. Sarkis J Khoury, 1979. "International Banking: A Special Look at Foreign Banks in the U.S," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 10(3), pages 36-52, September.
    4. Douglas Nigh & Kang Rae Cho & Suresh Krishnan, 1986. "The Role of Location-Related Factors in U.S Banking Involvement Abroad: An Empirical Examination," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 17(3), pages 59-72, September.
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    Cited by:

    1. Tschoegl, Adrian E., 2002. "Entry and survival: the case of foreign banks in Norway," Scandinavian Journal of Management, Elsevier, vol. 18(2), pages 131-153, June.

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