Author information:
Péter Asztalos: Magyar Nemzeti Bank, Analyst. E-mail: asztalosp@mnb.hu
Gábor Horváth: Magyar Nemzeti Bank, Senior Economic Expert. E-mail: horvathga@mnb.hu
Štefan Krakovský: Magyar Nemzeti Bank, Analyst. E-mail: krakovskys@mnb.hu
Tamás Tóth: Magyar Nemzeti Bank, Analyst. E-mail: tothtamas1@mnb.hu
Abstract:
The competitiveness of a national economy structurally depends on the efficiency and quality of financial intermediation, which is in a close relationship with the competitiveness of the banking system. In our opinion, banking system competitiveness can best be captured through the sustained supportive role of the banking system in economic growth, which in practice is implemented through the efficient allocation of financial resources. In the course of our research we developed an index designed to measure the competitiveness of European banking systems which, in our understanding, is the first of its kind. It models competitiveness from two different or even conflicting perspectives – from the consumer and from the investor side alike – and synthesizes the results received. Our analysis points out that the Hungarian banking system lags significantly behind its peers with respect to the price-setting of loans to households, digitalisation and operational efficiency, and presents the sources of competitive advantage in national economies with a competitive banking system in place.
Cite as (APA):
Asztalos, P., Horváth, G., Krakovský, Š., & Tóth, T. (2017). Resolving Conflicts in Measuring Banking System Competitiveness – MNB Banking System Competitiveness Index. Financial and Economic Review, 16(3), 5–31. https://doi.org/10.25201/FER.16.3.531
Column:
Study
Journal of Economic Literature (JEL) codes:
E51, O40, E44
Keywords:
finance, capital attractiveness, stability, growth, competitiveness
References:
Banai, Á. – Horváth, G. – Vonnák, B. (2016): The role of financial intermediation in growth. In: Competitiveness and Growth. Magyar Nemzeti Bank, 2016: 186–211.
Berger, A. N. (1995): The Profit-Structure Relationship in Banking: Tests of Market-Power and Efficient-Structure Hypotheses. Journal of Money, Credit and Banking, 27(2), May: 404–431. https://doi.org/10.2307/2077876.
Claessens, S. (2009): Competition in the Financial Sector: Overview of Competition Policies. World Bank Research Observer, 24(1): 83–118. https://doi.org/10.1093/wbro/lkp004.
Claessens, S. – Laeven, L. (2004): What Drives Bank Competition? Some International Evidence. Journal of Money, Credit and Banking, 36(3), June: 563–583. https://doi.org/10.1353/mcb.2004.0044.
Čihák, M. – Demirgüc-Kunt, A. – Feyen, E. – Levine, R. (2012): Benchmarking Financial Systems around the World. World Bank, Policy Research Working Paper 6175, August.
Financial Times (2017): European Business School Rankings 2016. http://rankings.ft.com/businessschoolrankings/european-business-school-rankings-2016. Downloaded: 1 August 2017.
Gerschenkron, A. (1962): Economic Backwardness in Historical Perspective. A Book of Essays. Cambridge, Massachusetts: Belknap Press of Harvard University Press.
Hatzichronoglou, T. (1996): Globalisation and Competitiveness: Relevant indicators. OECD STI Working Papers 1996/5, Paris.
Hicks, J. (1935): Annual Survey of Economic Theory: The Theory of Monopoly. Econometrica, 3(1), January: 1–20. https://doi.org/10.2307/1907343.
IMD (2017): World Competitiveness Yearbook 2017. https://worldcompetitiveness.imd.org/. Downloaded: 1 August 2017.
Klaus Schwab, World Economic Forum (2017): The Global Competitiveness Report 2016–2017. Online: https://www.weforum.org/reports/the-global-competitiveness-report-2016-2017-1. Downloaded: 1 August 2017.
MNB (2014): Átalakulóban a magyar bankrendszer: Vitaindító a magyar bankrendszerre vonatkozó konszenzusos jövőkép kialakításához (Hungarian banking system in transition. A keynote paper for developing a consensus-based vision for the Hungarian banking system.) MNB-tanulmányok különkiadás (MNB Occassional Papers, Special Issue)
Nafzinger, E. W. (2006): Economic development. Cambridge University Press, New York.
Porter, M. E. (1998): The Competitive Advantage of Nations. The Free Press, New York. https://doi.org/10.1007/978-1-349-14865-3.
van Leuvensteijn, M. – Sorensen, C. K. – Bikker, J. A. – Van Rixtel, A. A. (2013): Impact of bank competition on the interest rate pass-through in the euro area. European Central Bank, Working Paper Series, March, No. 885. https://doi.org/10.1080/00036846.2011.617697.
World Bank (2017): Doing Business – 2017. http://www.doingbusiness.org/. Downloaded: 1 August 2017.