Bank Entry Research Articles

Does Foreign Bank Entry Contribute to Financial Depth?: Examining the Role of Income Thresholds

Does Foreign Bank Entry Contribute to Financial Depth?: Examining the Role of Income Thresholds

Foreign Bank Entry in the Late Ottoman Empire: The Case of the Imperial Ottoman Bank

AbstractBefore 1900, there were few foreign banks in the Ottoman Empire. The most important foreign bank was the Imperial Ottoman Bank. Many rival foreign banks established a presence over time, which could have undermined the power of the Imperial Ottoman Bank due to greater competition. This article examines how rival foreign banks affected the Imperial Ottoman Bank branches, using data on profits of these branches between 1895 and 1914. Empirical findings do not indicate that rival bank branches were related to lower profits for Imperial Ottoman Bank branches in the respective markets.

Foreign Competition and Banking Industry Dynamics: An Application to Mexico

The authors develop a simple general equilibrium framework to study the effects of global competition on banking industry dynamics and welfare. They apply the framework to the Mexican banking industry, which underwent a major structural change in the 1990s as a consequence of both government policy and external shocks. Given the high concentration in the Mexican banking industry, domestic and foreign banks act strategically in the authors’ framework. After calibrating the model to Mexican data, the authors examine the welfare consequences of government policies that promote global competition. They find relatively high economy-wide welfare gains from allowing foreign bank entry.

An approach to creating a more realistic working model from a protein data bank entry.

An accurate model of three-dimensional protein structure is important in a variety of fields such as structure-based drug design and mechanistic studies of enzymatic reactions. While the entries in the Protein Data Bank ( http://www.pdb.org ) provide valuable information about protein structures, a small fraction of the PDB structures were found to contain anomalies not reported in the PDB file. The semiempirical PM7 method in MOPAC2012 was used for identifying anomalously short hydrogen bonds, C-H⋯O/C-H⋯N interactions, non-bonding close contacts, and unrealistic covalent bond lengths in recently published Protein Data Bank files. It was also used to generate new structures with these faults removed. When the semiempirical models were compared to those of PDB_REDO (http://www.cmbi.ru.nl/pdb_redo/), the clashscores, as defined by MolProbity ( http://molprobity.biochem.duke.edu/), were better in about 50% of the structures. The semiempirical models also had a lower root-mean-square-deviation value in nearly all cases than those from PDB_REDO, indicative of a better conservation of the tertiary structure. Finally, the semiempirical models were found to have lower clashscores than the initial PDB file in all but one case. Because this approach maintains as much of the original tertiary structure as possible while improving anomalous interactions, it should be useful to theoreticians, experimentalists, and crystallographers investigating the structure and function of proteins.

Spillover Effects of Foreign Bank Entry in China’s Banking Sector

This paper examines the foreign financial institutions’ spillover effects in China’s banking sector through three channels, foreign strategic investment, employee turnover, and competition using qualitative analyses and quantitative analyses. Through comparing Chinese banks performance between pre- and post- foreign strategic investment, and the OLS regression analyses, we found that the foreign strategic investment did benefit Chinese banks, but the impact of strategic investment is not very obvious. Employee turnover gives Chinese banks opportunity to learn from foreign banks, but the employee mobility from Chinese banks to foreign banks benefit foreign banks more. Although Chinese banking sector is open to foreign banks, the growth of foreign banks in China is restricted, and the competition effects are not very obvious.

Efficiency of Foreign Banks Operating in India: DEA Analysis

Indian financial sector has observed various modifications in the policies and prudential norms to raise the banking standards in India to the international strength. Various financial reforms have taken place in 1991 which improved flexibility and operational autonomy in the banking sector. In 1992, on the recommendation of Narasimham committee, a series of developments were instigated. In 1993-94, the approval was accepted for the entry of new private banks and foreign banks in Indian banking sector. After the post reform era, the operations of Foreign Banks (FBs) received a considerable boost. The Reserve Bank of India liberalized its policy for foreign banks implying new opportunities for growth and different representations in India. The present study makes an attempt to measure and compare the efficiency scores of Public Sector Banks (PSBs), Private Sector banks and FBs operating in India during 2008-2013 using frontier based non-parametric technique, i.e., DEA, the result demonstrates that the efficiency of FBs has shown continuous improvement in comparison with PSBs and Private Banks following the route of deregulation with modest drifts.

Where Are All the New Banks? The Role of Regulatory Burden in New Charter Creation

New bank formation in the U.S. has declined dramatically since the financial crisis, from well over 100 new banks per year to less than 1. Many have suggested that this is due to newly-instituted regulation, but the current weak economy and low interest rates (which both depress banking profits) could also have played a role. We estimate a model of bank entry decisions on data from 1976 to 2013 which indicates that at least 75% of the decline in new bank formation would have occurred without any regulatory change. The standalone effect of regulation is more difficult to quantify.

Modeling the role of G12V and G13V Ras mutations in the Ras-GAP-catalyzed hydrolysis reaction of guanosine triphosphate.

Cancer-associated point mutations in Ras, in particular, at glycine 12 and glycine 13, affect the normal cycle between inactive GDP-bound and active GTP-bound states. In this work, the role of G12V and G13V replacements in the GAP-stimulated intrinsic GTP hydrolysis reaction in Ras is studied using molecular dynamics (MD) simulations with quantum mechanics/molecular mechanics (QM/MM) potentials. A model molecular system was constructed by motifs of the relevant crystal structure (Protein Data Bank entry 1WQ1 ). QM/MM optimization of geometry parameters in the Ras-GAP-GTP complex and QM/MM-MD simulations were performed with a quantum subsystem comprising a large fraction of the enzyme active site. For the system with wild-type Ras, the conformations fluctuated near the structure ready to be involved in the efficient chemical reaction leading to the cleavage of the phosphorus-oxygen bond in GTP upon approach of the properly aligned catalytic water molecule. Dynamics of the system with the G13V mutant is characterized by an enhanced flexibility in the area occupied by the γ-phosphate group of GTP, catalytic water, and the side chains of Arg789 and Gln61, which should somewhat hinder fast chemical steps. Conformational dynamics of the system with the G12V mutant shows considerable displacement of the Gln61 side chain and catalytic water from their favorable arrangement in the active site that may lead to a marked reduction in the reaction rate. The obtained computational results correlate well with the recent kinetic measurements of the Ras-GAP-catalyzed hydrolysis of GTP.

The semiquinone at the Qi site of the bc1 complex explored using HYSCORE spectroscopy and specific isotopic labeling of ubiquinone in Rhodobacter sphaeroides via (13)C methionine and construction of a methionine auxotroph.

Specific isotopic labeling at the residue or substituent level extends the scope of different spectroscopic approaches to the atomistic level. Here we describe 13C isotopic labeling of the methyl and methoxy ring substituents of ubiquinone, achieved through construction of a methionine auxotroph in Rhodobacter sphaeroides strain BC17 supplemented with l-methionine with the side chain methyl group 13C-labeled. Two-dimensional electron spin echo envelope modulation (HYSCORE) was applied to study the 13C methyl and methoxy hyperfine couplings in the semiquinone generated in situ at the Qi site of the bc1 complex in its membrane environment. The data were used to characterize the distribution of unpaired spin density and the conformations of the methoxy substituents based on density functional theory calculations of 13C hyperfine tensors in the semiquinone of the geometry-optimized X-ray structure of the bc1 complex (Protein Data Bank entry 1PP9) with the highest available resolution. Comparison with other proteins indicates individual orientations of the methoxy groups in each particular case are always different from the methoxy conformations in the anion radical prepared in a frozen alcohol solution. The protocol used in the generation of the methionine auxotroph is more generally applicable and, because it introduces a gene deletion using a suicide plasmid, can be applied repeatedly.

Efectos de la presencia de la banca extranjera en la banca nacional del Perú: un estudio comparativo 1995-2007 (avances)

La presencia de bancos extranjeros en la economía peruana no es un fenómeno nuevo. Sin embargo, su importancia se pone de manifiesto en las últimas décadas con la apertura de la economía y la liberalización del mercado bancario. El propósito del presente trabajo es evaluar los efectos del ingreso de bancos extranjeros en el comportamiento de los bancos en el Perú en relación a la competencia, eficiencia, márgenes de interés, y la ganancia. Se puede plantear la hipótesis de que el ingreso de los bancos extranjeros en el Perú, contribuye a estimular a los bancos nacionales a través de una mayor competencia, menores márgenes, disminución de costos, al aumento de la eficiencia y a la mayor diversidad de productos y servicios financieros.

Competition, Concentration and the Relevance of New Banks’ Entry in the Indian Banking System

This article analyzes the evolution of competition in the Indian banking system for the period 1994– 2011. The reform process for the Indian banking sector started in 1992, led by the Narasimhan committee report and thus the period of study is divided into three phases: deregulation and liberalization, consolidation and post-consolidation period. To evaluate competition, we apply two indicators of competition from the theory of industrial organization: concentration indices and Panzar and Rosse’s H-statistic (PRH statistic). The empirical evidence from the PRH statistic does not permit us to reject the existence of monopolistic competition. There is a steady fall in concentration ratios suggesting an improvement in competitive conditions. The PRH statistic suggests a fall in competitive condition during the consolidation phase followed by a revival in competitive conditions during the post consolidation period. This study also helps in understanding the effect of new banks’ entry in the Indian banking sector on the competitive conditions. The results obtained support the decision by Reserve Bank of India to allow entry of new private banks which will help in further infusing competition in the Indian banking sector.

Role of Stress and Job Performance among Banks Employees: An Analysis

At the present scenario banking sector has undergone tremendous changes in the recent past. Liberalisation, Globalisation and Privatisation entry of foreign banks, technological developments and increased competition has made banks to strive hard for success. Banks are not thinking in terms of traditional services but value added benefits to the customers for competitive advantage. This has put pressure on the employees of banks to render better job performance in terms of results. Due to this, the employees face role overload, role ambiguity which are the symptoms of role stress. The study tests role stress and its impact on job performance by using (n=95) data of employees including managers, officers and clerks of banks in Gulbarga. The data obtained through questionnaires were analyzed using statistical tools like Mean, Standard deviation and Regression. The analysis of variance revealed significant difference between Role Stress with Gender , Education levels, Designation, Income levels and Age groups of respondents.

Financial liberalization and the middle-income trap: What can China learn from the cross-country experience?

Should China accelerate financial liberalization in order to avoid the middle-income trap? And, if the answer is yes, which specific reform steps should the government undertake? In this study we attempt to shed light on these questions by examining experiences of 80 countries during the period 1980–2010. Empirical analyses reveal that the growth effect of financial repression is insignificant among low-income economies, significantly negative among middle-income economies and significantly positive among high-income economies. Furthermore, for the middle-income group, repressive policies on credit, bank entry, securities market and the capital account significantly inhibit economic growth. In the meantime, law and order promotes growth among all income groups, while democracy has no impact whatsoever. We also validate these findings through a range of robustness checks. These findings offer important policy implications for China.

Noncompetitive inhibition of indolethylamine-N-methyltransferase by N,N-dimethyltryptamine and N,N-dimethylaminopropyltryptamine.

Indolethylamine-N-methyltransferase (INMT) is a Class 1 transmethylation enzyme known for its production of N,N-dimethyltryptamine (DMT), a hallucinogen with affinity for various serotonergic, adrenergic, histaminergic, dopaminergic, and sigma-1 receptors. DMT is produced via the action of INMT on the endogenous substrates tryptamine and S-adenosyl-l-methionine (SAM). The biological, biochemical, and selective small molecule regulation of INMT enzyme activity remain largely unknown. Kinetic mechanisms for inhibition of rabbit lung INMT (rabINMT) by the product, DMT, and by a new novel tryptamine derivative were determined. After Michaelis–Menten and Lineweaver–Burk analyses had been applied to study inhibition, DMT was found to be a mixed competitive and noncompetitive inhibitor when measured against tryptamine. The novel tryptamine derivative, N-[2-(1H-indol-3-yl)ethyl]-N′,N′-dimethylpropane-1,3-diamine (propyl dimethyl amino tryptamine or PDAT), was shown to inhibit rabINMT by a pure noncompetitive mechanism when measured against tryptamine with a Ki of 84 μM. No inhibition by PDAT was observed at 2 mM when it was tested against structurally similar Class 1 methyltransferases, such as human phenylethanolamine-N-methyltransferase (hPNMT) and human nicotinamide-N-methyltransferase (hNNMT), indicating selectivity for INMT. The demonstration of noncompetitive mechanisms for INMT inhibition implies the presence of an inhibitory allosteric site. In silico analyses using the computer modeling software Autodock and the rabINMT sequence threaded onto the human INMT (hINMT) structure (Protein Data Bank entry 2A14) identified an N-terminal helix–loop–helix non-active site binding region of the enzyme. The energies for binding of DMT and PDAT to this region of rabINMT, as determined by Autodock, were −6.34 and −7.58 kcal/mol, respectively. Assessment of the allosteric control of INMT may illuminate new biochemical pathway(s) underlying the biology of INMT.

A game-theoretical model of bank foreign direct investment strategy in emerging market economies

Purpose – The purpose of this paper is to propose a game-theoretical model for commercial bank foreign direct investment strategy, government policy and domestic banking industry interactions in emerging market economies and demonstrate the application of this strategy to the banking system. Government policy and domestic banking industry interactions in emerging market economies and demonstrate the application of this strategy to the banking system. Design/methodology/approach – The paper develops a game-theoretical model to analyze the optimality of the limiting entry strategy followed by a given domestic institutional sector when considering the entry applications of foreign banks in the domestic financial system. The model analyzes the strategic options available to an emerging market country with a relatively underdeveloped banking system when deciding whether or not and to what extent allow for the entrance of better reputed and more technologically advanced foreign banks in its domestic financial system. Findings – The paper shows that the progressive liberalization of entry restrictions would define the perfect Bayesian equilibria of the subsequent set of continuation games and the respective payoffs derived from this liberalization as the domestic economy integrates and competes within the global financial system. Originality/value – Banks operating in the international financial market have incentives to invest directly in emerging market economies and governments have incentives in allowing foreign banks entry to their market. As banking systems in these economies are generally underdeveloped, opening the financial system to foreign competitors could lead to a decrease in the market share of local banks. Eventually foreign banks could control the banking system and could de facto control the money supply.

After Embedding in Membranes Antiapoptotic Bcl-XL Protein Binds Both Bcl-2 Homology Region 3 and Helix 1 of Proapoptotic Bax Protein to Inhibit Apoptotic Mitochondrial Permeabilization

Bcl-XL binds to Bax, inhibiting Bax oligomerization required for mitochondrial outer membrane permeabilization (MOMP) during apoptosis. How Bcl-XL binds to Bax in the membrane is not known. Here, we investigated the structural organization of Bcl-XL·Bax complexes formed in the MOM, including the binding interface and membrane topology, using site-specific cross-linking, compartment-specific labeling, and computational modeling. We found that one heterodimer interface is formed by a specific interaction between the Bcl-2 homology 1-3 (BH1-3) groove of Bcl-XL and the BH3 helix of Bax, as defined previously by the crystal structure of a truncated Bcl-XL protein and a Bax BH3 peptide (Protein Data Bank entry 3PL7). We also discovered a novel interface in the heterodimer formed by equivalent interactions between the helix 1 regions of Bcl-XL and Bax when their helical axes are oriented either in parallel or antiparallel. The two interfaces are located on the cytosolic side of the MOM, whereas helix 9 of Bcl-XL is embedded in the membrane together with helices 5, 6, and 9 of Bax. Formation of the helix 1·helix 1 interface partially depends on the formation of the groove·BH3 interface because point mutations in the latter interface and the addition of ABT-737, a groove-binding BH3 mimetic, blocked the formation of both interfaces. The mutations and ABT-737 also prevented Bcl-XL from inhibiting Bax oligomerization and subsequent MOMP, suggesting that the structural organization in which interactions at both interfaces contribute to the overall stability and functionality of the complex represents antiapoptotic Bcl-XL·Bax complexes in the MOM.

Does Foreign Bank Entry Improve Credit Allocation and Lending Rates?: Evidence from Indonesia

This study aims to investigate the impact of the existence of foreign banks on the allocation of loans and lending rates in Indonesia. The first part of this study examines the impact of the ownership types of the foreign banks on credit allocation based on borrower types, i.e: corporations and small and medium enterprises (SMEs), and loan currency. In addition, we estimate determinants of lending rate, by taking into account the impact of foreign bank’s modes of entry, bank characteristics, macroeconomics variables, and bank market structure. This study found that foreign banks that enter the Indonesian banking market via Greenfield investments and takeover tend to channel lower proportion of credit for the SMEs. In addition, Greenfield foreign banks provide more loans in foreign currency, a result that can be explained by the notion that foreign banks have better access to world capital market and possibly serve more large firms and foreign clients in foreign currencies. The last result confirms that Greenfield banks in general charge lower lending rates on the credits.

Transfer of reputation: Multinational banks and perceived creditworthiness of transition countries

ABSTRACTHow do international investors evaluate sovereign borrowers whose histories and institutions are too new or weak to send strong signals about their creditworthiness? In this paper, I suggest that the perceived creditworthiness of many transition countries’ governments rests on a ‘transfer’ of good reputation from prestigious multinational banks, as foreign direct investors. The entry of reputable foreign banks into a transition country signals to international financial markets about the financial strength of that host economy. It also involves the transfer of the status of lender of last resort to the foreign parent bank. Foreign bank penetration can thus create optimistic expectations about a host country's capacity to service its sovereign debt. Using panel data for 23 transition economies during the period of 1996–2009, my empirical results provide support for the argument stressing the exogenous role of foreign financiers as enhancers of the credibility of host country governments. The results are robust to instrumental variable analysis and the inclusion of number of controls for alternative determinants of investors' perceptions of country risk. This proposition is further backed by evidence from three transition countries: Hungary, Estonia and Ukraine.

Entry, Exit and Growth of US Commercial Banks

We investigate the entry, exit and growth of commercial banks in the United States (US) during the period 1984-2012. Hazard function estimations for the probability of exit via acquisition and failure, and cross-sectional growth regressions examine the impact of exit through merger and acquisition (M&A) or failure, and internally-generated growth. The hazard of disappearance via acquisition is inversely to asset size and quality, profitability, managerial efficiency and capitalization, and positively related to liquidity. Small banks with a higher proportion of their assets in lending, and small banks with high credit risk, are more likely to fail. We report evidence of an inverse relationship between bank size and growth, and some evidence of persistence in growth performance from one year to the next among smaller banks.

The Crystal Structure of Shiga Toxin Type 2 with Bound Disaccharide Guides the Design of a Heterobifunctional Toxin Inhibitor

Shiga toxin type 2 (Stx2a) is clinically most closely associated with enterohemorrhagic E. coli O157:H7-mediated hemorrhagic colitis that sometimes progresses to hemolytic-uremic syndrome. The ability to express the toxin has been acquired by other Escherichia coli strains, and outbreaks of food poisoning have caused significant mortality rates as, for example, in the 2011 outbreak in northern Germany. Stx2a, an AB5 toxin, gains entry into human cells via the glycosphingolipid receptor Gb3. We have determined the first crystal structure of a disaccharide analog of Gb3 bound to the B5 pentamer of Stx2a holotoxin. In this Gb3 analog,-GalNAc replaces the terminal-Gal residue. This co-crystal structure confirms previous inferences that two of the primary binding sites identified in theB5 pentamer of Stx1 are also functional in Stx2a. This knowledge provides a rationale for the synthesis and evaluation of heterobifunctional antagonists for E. coli toxins that target Stx2a. Incorporation of GalNAc Gb3 trisaccharide in a heterobifunctional ligand with an attached pyruvate acetal, a ligand for human amyloid P component, and conjugation to poly[acrylamide-co-(3-azidopropylmethacrylamide)] produced a polymer that neutralized Stx2a in a mouse model of Shigatoxemia.