Financial Intermediation Costs In Low Income Countries

Author : Mr.Tigran Poghosyan
Publisher : International Monetary Fund
Page : 54 pages
File Size : 43,5 Mb
Release : 2012-05-01
Category : Business & Economics
ISBN : 9781475564136

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Financial Intermediation Costs in Low-Income Countries by Mr.Tigran Poghosyan Pdf

We analyze factors driving persistently higher financial intermediation costs in low-income countries (LICs) relative to emerging market (EMs) country comparators. Using the net interest margin as a proxy for financial intermediation costs at the bank level, we find that within LICs a substantial part of the variation in interest margins can be explained by bank-specific factors: margins tend to increase with higher riskiness of credit portfolio, lower bank capitalization, and smaller bank size. Overall, we find that concentrated market structures and lack of competition in LICs banking systems and institutional weaknesses constitute the key impediments preventing financial intermediation costs from declining. Our results provide strong evidence that policies aimed at fostering banking competition and strengthening institutional frameworks can reduce intermediation costs in LICs.

Author : Mariusz Jarmuzek,Mr.Tonny Lybek
Publisher : International Monetary Fund
Page : 43 pages
File Size : 48,7 Mb
Release : 2018-12-11
Category : Business & Economics
ISBN : 9781484385678

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Can Good Governance Lower Financial Intermediation Costs? by Mariusz Jarmuzek,Mr.Tonny Lybek Pdf

This paper argues that better governance practices can reduce the costs, risks and uncertainty of financial intermediation. Our sample covers high-, middle- and low-income countries before and after the global financial crisis (GFC). We find that net interest margins of banks are lower if various governance indicators are better. More cross-border lending also appears conducive to lower intermediation costs, while the level of capital market development is not significant. The GFC seems not to have had a strong impact except via credit risk. Finally, we estimate the size of potential gains from improved governance.

Author : James A. Hanson,Roberto Rezende Rocha
Publisher : Unknown
Page : 102 pages
File Size : 48,6 Mb
Release : 1986
Category : Business & Economics
ISBN : STANFORD:36105040483005

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High Interest Rates, Spreads, and the Costs of Intermediation by James A. Hanson,Roberto Rezende Rocha Pdf

High interest rates have become a global concern in both the industrialized and developing countries. In some developing countries they have reached real levels far above even the unprecedented rates prevailing in international capital markets. Such rates prejudice investment and clearly require attention if growth is to be resumed during adjustment. The two papers in this volume analyze some of the causes of high real rates and suggest some policy options for bringing rates down. The first paper summarizes the Industry Department's ongoing work on high real rates while the second paper presents perhaps the first cross-country analysis of banking costs and profits in developing countries. The papers conclude that reductions in direct taxes and in reserve requirements and forced investments could reduce the gap between deposit and lending rates dramatically, and thus lower real lending rates sharply.

Author : Mr.Philipp C. Rother
Publisher : International Monetary Fund
Page : 33 pages
File Size : 40,8 Mb
Release : 1999-03-01
Category : Business & Economics
ISBN : 9781451845433

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Explaining the Behavior of Financial Intermediation by Mr.Philipp C. Rother Pdf

This paper investigates the effects of macroeconomic and structural variables on financial intermediation. To this end, it presents a theoretical foundation for two new measures of intermediation, the money multiplier and the ratio of private sector credit to monetary base. Results from panel estimations covering 19 transition economies indicate that policy makers need to address in particular the problems of bad loans on bank balance sheets and high market concentration while maintaining a stable macroeconomic environment. Further variables, such as minimum reserve requirements and the capital adequacy ratio, are found to possess less explanatory power.

Author : Jeremy Greenwood
Publisher : DIANE Publishing
Page : 46 pages
File Size : 53,9 Mb
Release : 2010-10
Category : Business & Economics
ISBN : 9781437933970

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Quantifying the Impact of Financial Development on Economic Development by Jeremy Greenwood Pdf

How important is financial development for economic development? A costly state verification model of financial intermediation is presented to address this question. The model is calibrated to match facts about the U.S. economy, such as intermediation spreads and the firm-size distribution for the years 1974 and 2004. It is then used to study the international data, using cross-country interest-rate spreads and per-capita GDP. The analysis suggests that a country like Uganda could increase its output by 140 to 180 percent if it could adopt the world's best practice in the financial sector. Still, this amounts to only 34 to 40 percent of the gap between Uganda's potential and actual output. Charts and tables.

Author : Donald R. Lessard,John Williamson
Publisher : Unknown
Page : 140 pages
File Size : 50,6 Mb
Release : 1985
Category : Intermediation (Finance).
ISBN : UCSD:31822002954824

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Financial Intermediation Beyond the Debt Crisis by Donald R. Lessard,John Williamson Pdf

Author : International Monetary Fund
Publisher : International Monetary Fund
Page : 86 pages
File Size : 41,9 Mb
Release : 2012-04-16
Category : Business & Economics
ISBN : 9781498340687

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Enhancing Financial Sector Surveillance in Low-Income Countries - Case Studies by International Monetary Fund Pdf

This supplement presents ten case studies, which highlight the roles of targeted policies to facilitate sustainable financial deepening in a variety of country circumstances, reflecting historical experiences that parallel a range of markets in LICs. The case studies were selected to broadly capture efforts by countries to increase reach (e.g., financial inclusion), depth (e.g., financial intermediation), and breadth of financial systems (e.g., capital market, cross-border development). The analysis in the case studies highlights the importance of a balanced approach to financial deepening. A stable macroeconomic environment is vital to instill consumer, institutional, and investor confidence necessary to encourage financial market activity. Targeted public policy initiatives (e.g., collateral, payment systems development) can be helpful in removing impediments and creating infrastructure for improved market operations, while ensuring appropriate oversight and regulation of financial markets, to address potential sources of instability and market failures.

Author : Ms. Era Dabla-Norris,Yan Ji,Robert Townsend,D. Filiz Unsal
Publisher : International Monetary Fund
Page : 49 pages
File Size : 50,6 Mb
Release : 2015-01-27
Category : Business & Economics
ISBN : 9781484352878

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Identifying Constraints to Financial Inclusion and Their Impact on GDP and Inequality: A Structural Framework for Policy by Ms. Era Dabla-Norris,Yan Ji,Robert Townsend,D. Filiz Unsal Pdf

We develop a micro-founded general equilibrium model with heterogeneous agents to identify pertinent constraints to financial inclusion. We evaluate quantitatively the policy impacts of relaxing each of these constraints separately, and in combination, on GDP and inequality. We focus on three dimensions of financial inclusion: access (determined by the size of participation costs), depth (determined by the size of collateral constraints resulting from limited commitment), and intermediation efficiency (determined by the size of interest rate spreads and default possibilities due to costly monitoring). We take the model to a firm-level data from the World Bank Enterprise Survey for six countries at varying degrees of economic development—three low-income countries (Uganda, Kenya, Mozambique), and three emerging market countries (Malaysia, the Philippines, and Egypt). The results suggest that alleviating different financial frictions have a differential impact across countries, with country-specific characteristics playing a central role in determining the linkages and tradeoffs between inclusion, GDP, inequality, and the distribution of gains and losses.

Author : Andrés Erosa
Publisher : London : Department of Economics, University of Western Ontario
Page : 43 pages
File Size : 41,6 Mb
Release : 2000
Category : Electronic
ISBN : 0771422415

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Financial Intermediation and Occupational Choice in Development by Andrés Erosa Pdf

Author : Patrick Honohan
Publisher : World Bank Publications
Page : 476 pages
File Size : 44,8 Mb
Release : 2003
Category : Business & Economics
ISBN : 0821354345

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Taxation of Financial Intermediation by Patrick Honohan Pdf

This book examines the options for, and obstacles to, successful financial sector tax reform, both in terms of theoretical and practical aspects. Issues discussed include: the design of optimal tax schemes, the role of imperfect information and the links between taxation and saving, inflation, the income tax treatment of intermediary loan-loss reserves, deposit insurance, VAT and financial transactions taxes; as well as current practice in the industrial world and case studies of distorted national systems. This is a co-publication of the World Bank and Oxford University Press.

Author : F. J. A. Bouman
Publisher : Routledge
Page : 430 pages
File Size : 47,7 Mb
Release : 2019-03-11
Category : Political Science
ISBN : 9780429690877

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Financial Landscapes Reconstructed by F. J. A. Bouman Pdf

The past few decades have seen special and changing emphasis in policy frameworks of rural financial intermediation in developing countries, varying from the distribution of cheap credit via specialized farm credit institutions, to the building of linkages between banks and savings groups, to attempts to use traders or NGOs as new conduits of lending. The destructive impact of cheap credit programs on rural financial markets has been the subject of two conferences organized by the Ohio State University in the USA in 1976 and 1981, in conjunction with the Agency for International Development and the World Bank. They resulted in a collection of readings edited by J.D. Von Pischke, Dale W Adams and Gordon Donald, Rural Financial Markets in Developing Countries (Baltimore: Johns Hopkins Press 1983), followed by Undermining Rural Development With Cheap Credit, edited by Dale W Adams, Douglas H. Graham and J.D. Von Pischke (Boulder: Westview Press 1984). Acknowledging the increasing interest of researchers and policymakers in the roles and uses of informal financial intermediaries, the Ohio State University subsequently organized a Seminar in Washington, D.C., in 1989 that produced Informal Finance in LowIncome Countries, edited by Dale W Adams and Delbert A. Fitchett (Boulder: Westview Press 1992).

Author : Edmar Lisboa Bacha,Carlos Federico Díaz Alejandro
Publisher : Unknown
Page : 52 pages
File Size : 43,8 Mb
Release : 1982
Category : Business & Economics
ISBN : UOM:49015000007550

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International Financial Intermediation by Edmar Lisboa Bacha,Carlos Federico Díaz Alejandro Pdf

Author : Jan Pieter Krahnen,Reinhard H Schmidt
Publisher : Westview Press
Page : 184 pages
File Size : 50,7 Mb
Release : 1994-07-17
Category : Business & Economics
ISBN : STANFORD:36105009689451

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Development Finance As Institution Building by Jan Pieter Krahnen,Reinhard H Schmidt Pdf

A substantial revision of a report to the International Labour Office in Geneva, which commissioned the comparative study of financial institutions and mechanisms within the context of its renewed focus on programs against poverty and in support of the private sector. The findings were at odds with the organization's approach of target-group oriented finance to build sustainable financial intermediaries for people and potential entrepreneurs in developing countries. Annotation copyright by Book News, Inc., Portland, OR

Author : Maxwell J. Fry
Publisher : Unknown
Page : 552 pages
File Size : 55,7 Mb
Release : 1988
Category : Banks and banking
ISBN : UCSD:31822003118007

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Money, Interest, and Banking in Economic Development by Maxwell J. Fry Pdf

Author : Indrajit Mallick,Sugata Marjit
Publisher : SAGE Publications Pvt. Limited
Page : 328 pages
File Size : 55,9 Mb
Release : 2008-08-07
Category : Business & Economics
ISBN : UOM:39015077124611

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Financial Intermediation in a Less Developed Economy by Indrajit Mallick,Sugata Marjit Pdf

Financial Intermediation in a Less Developed Economy is an institutional narrative of a bank in a developing economy which acts as a case study and brings out the essential relationship between finance and economic development. The volume defines the financial intermediary organization and relates it to the process of economic development. In the process the authors argue that the conventional models of banking constructed for developed countries need to be complemented by institutional narratives of banking that focus on minimization of the transaction costs of finance and organization.