Abstract
Competition in the banking sector is different from the competition in the other sectors. Banks can compete only onthe basis of banking products. Also, banks are dependent on each other – actions of every market participant may strongly affectthe others. Problems of one bank may encourage distrust of the entire banking system. Analysis of Lithuanian banking sectorhas showed that country’s banking sector can be divided into three groups – the biggest banks, smaller and medium-sized banksand foreign banks branches. The largest part of banking sector is concentrated in activity of the three banks. All these banksare owned by Scandinavian capital. Lithuanian banking sector is highly concentrated. In 2005–2012 years the average mean ofthree banks concentration index (CR3) in deposits, assets and loans markets was 68 percent. According to these high values ofconcentration rates, Lithuanian banking sector can be characterized as oligopoly. Globalizacija, bankų konsolidacija, pasaulinė finansų krizė pastaraisiaisdešimtmečiais stipriai paveikė bankininkystės sektorių.Visi šie pokyčiai turėjo įtakos ir sektoriaus konkurencijai bei koncentracijai.Bankininkystės sektoriaus konkurencija ir koncentracijanagrinėjama teoriniu ir praktiniu aspektais. Analizuojamasąsajos tarp konkurencijos ir stabilumo, efektyvumo bei finansiniųpaslaugų prieinamumo. Išskiriami pagrindiniai veiksniai, lemiantyskonkurenciją bankininkystės sektoriuje. Atlikta Lietuvosbankininkystės sektoriaus analizė, įvertintas konkurencijos irkoncentracijos Baltijos šalių bankiniuose sektoriuose laipsnis.
Highlights
The banking system in the country’s economy is undenia ble
Banking activities have a material impact on the financial sector and the general economy of the country, and that’s why banking sector and the processes taking place in it has special attention
The developments had an impact on bank competition and banking sector concentration
Summary
The banking system in the country’s economy is undenia ble. None of the modern economy nowadays functions properly without banks. To identify competition in the banking sector and assess it in the article “k” concentration index and the Herfindahl-Hirschman index are calculated. Banks can compete on their own offers’ exclusivity and diversity, but considering Lithuanian market large gap between lower and big banks show differences in their competitiveness. These banks can be considered more secure due to their size, users may argue that large banks are less risky, and there is less chance that these banks will face serious problems (Too -big -to- fail) This approach is rather subjective, but it is likely that it can be one of the reasons contributing to the fact that large banks attract a greater number of customers.
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