“When in Rome, do as Romans”. Similarities of banks performance drivers in CESEE

The goal of this paper is to analyse whether the determinants of the profitability and business orientation of foreign-owned banks operating in Central, Eastern and South-Eastern Europe (CESEE) are similar to domestic-owned banks in that region and foreign parent companies. To this aim we also check if profitability of the parents predicts the profitability of their subsidiaries. We use annual bank- and country-level data from the 1995–2014 period applying feasible GLS. The empirical results suggest that statistically significant differences exist between foreign-owned banks and domestic-owned banks. Although the subsidiaries are similar to their parent banks regarding some aspects of the credit policy, the overall drivers of profitability and business orientations vary.

Iwanicz-Drozdowska, M., B. Witkowski y S. Carbó (2020). «“When in Rome, do as Romans”. Similarities of banks performance drivers in CESEE». Bank i Kredyt=Bank & Credit 51, n.º 5, pp. 467-504.