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Banksí Internationalization: Estonian and Russian Banksí Expansion to the Foreign Markets

Author

Listed:
  • Jari Jumpponen

    (Department of Industrial Engineering and Management, Lappeenranta University of Technology)

  • Kari Liuhto

    (Pan-European Institute at Turku School of Economics and Business Administration)

  • Mart Sırg

    (Institute of Finance and Accounting at the University of Tartu)

  • Vello Vensel

    (Department of Economics at Tallinn University of Technology)

Abstract

Direct investment outflow from transition economies abroad is still modest compared to investment inflow towards transition economies. Global economy both creates preconditions for and also motivates the internatio¨nalization of banks. The main aim of the article is to study activities of Estonian and Russian commercial banks in their efforts to transform themselves from local banks to international ones. As the internationalization of banks has not proceeded without problems and setbacks, the present research tries to point out the reasons why some of the plans were not realized. The authors of the paper argue that international economic ties provide benefits to all the parties involved and that international integration is an effective way of building international stability and economic growth.

Suggested Citation

  • Jari Jumpponen & Kari Liuhto & Mart Sırg & Vello Vensel, 2004. "Banksí Internationalization: Estonian and Russian Banksí Expansion to the Foreign Markets," Working Papers 109, Tallinn School of Economics and Business Administration, Tallinn University of Technology.
    • Handle: RePEc:ttu:wpaper:109
    Note: The authors gratefully acknowledge the financial support received from the Research Foundation of the OKO Bank Group, from Gˆran Collert Foundation, and from the Estonian Science Foundation (Project 5185).
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    References listed on IDEAS

    as
    1. Dario Focarelli & Alberto Franco Pozzolo, 2000. "The Determinants of Cross-Border Bank Shareholdings; an Analysis with Bank-Level Data from OECD Countries," Temi di discussione (Economic working papers) 381, Bank of Italy, Economic Research and International Relations Area.
    2. Herbert Stepic, 2002. "The Strategy of RZB in Central and Eastern Europe," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    3. Allen N. Berger & Robert DeYoung & Hesna Genay & Gregory F. Udell, 1999. "Globalization of financial institutions: evidence from cross-border banking performance," Working Paper Series WP-99-25, Federal Reserve Bank of Chicago.
    4. Tiiu Paas, 2000. "Gravity Approach For Modeling Trade Flows Between Estonia And The Main Trading Partners," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 4, Faculty of Economics and Business Administration, University of Tartu (Estonia).
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    banking sector reforms; banks internationalization and globalization; Estonian and Russian banks expansion abroad.;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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