University of Hertfordshire

By the same authors

Standard

Integration in the European Retail Banking Sector : Evidence from Deposit and Lending Rates. / Rughoo, Aarti; Sarantis, Nicholas.

2009. (Centre for Int Capital Markets Discussion Papers; No. 2009-6).

Research output: Working paperDiscussion paper

Harvard

Rughoo, A & Sarantis, N 2009 'Integration in the European Retail Banking Sector: Evidence from Deposit and Lending Rates' Centre for Int Capital Markets Discussion Papers, no. 2009-6.

APA

Rughoo, A., & Sarantis, N. (2009). Integration in the European Retail Banking Sector: Evidence from Deposit and Lending Rates. (Centre for Int Capital Markets Discussion Papers; No. 2009-6).

Vancouver

Rughoo A, Sarantis N. Integration in the European Retail Banking Sector: Evidence from Deposit and Lending Rates. 2009 Mar. (Centre for Int Capital Markets Discussion Papers; 2009-6).

Author

Rughoo, Aarti ; Sarantis, Nicholas. / Integration in the European Retail Banking Sector : Evidence from Deposit and Lending Rates. 2009. (Centre for Int Capital Markets Discussion Papers; 2009-6).

Bibtex

@techreport{8932635c0e4344c288edaa0e77155b4a,
title = "Integration in the European Retail Banking Sector: Evidence from Deposit and Lending Rates",
abstract = "This paper investigates the degree of integration in the retail-banking sector for 15 European Union member states between the period 1991 to March 2008. In view of consolidating and creating a single market in their financial services sector, the EU has launched and implemented major initiatives over the past years. The wholesale banking sector has been studied extensively but the retail market to a much lesser extent. The difficulty in analysing the integration process in the banking market is linked to the heterogeneity that exists across the European countries with regards to factors such as risk attitudes, cultural differences, and the home-bias criteria. As a result, it is argued that any convergence process in the banking sector, if present, should rather be perceived as a long-run relationship. Consequently, cointegration analysis, a technique used to capture such long-term relationships between sets of variables is used to analyse the integration process in the EU retail-banking sector. The starting point in the empirical analysis involves conducting multiple structural break analysis. Given that during the period under investigation, there have been significant milestones in the history of the European single market, the deposit and lending rates corresponding to this period are likely to exhibit structural change. Moreover, the timing and pattern of structural break occurrence should also act as an indicator of retail banking integration. The next steps in the empirical analysis look at stationarity tests for both time series data and panel data on data series that are also individually demeaned so as to account for structural breaks. Finally, bivariate time-series cointegration analysis on each of the EU countries and a weighted European average rate is performed. The cointegration analysis is performed on both level and demeaned data.",
keywords = "Retail banking",
author = "Aarti Rughoo and Nicholas Sarantis",
year = "2009",
month = mar,
language = "English",
series = "Centre for Int Capital Markets Discussion Papers",
number = "2009-6",
type = "WorkingPaper",

}

RIS

TY - UNPB

T1 - Integration in the European Retail Banking Sector

T2 - Evidence from Deposit and Lending Rates

AU - Rughoo, Aarti

AU - Sarantis, Nicholas

PY - 2009/3

Y1 - 2009/3

N2 - This paper investigates the degree of integration in the retail-banking sector for 15 European Union member states between the period 1991 to March 2008. In view of consolidating and creating a single market in their financial services sector, the EU has launched and implemented major initiatives over the past years. The wholesale banking sector has been studied extensively but the retail market to a much lesser extent. The difficulty in analysing the integration process in the banking market is linked to the heterogeneity that exists across the European countries with regards to factors such as risk attitudes, cultural differences, and the home-bias criteria. As a result, it is argued that any convergence process in the banking sector, if present, should rather be perceived as a long-run relationship. Consequently, cointegration analysis, a technique used to capture such long-term relationships between sets of variables is used to analyse the integration process in the EU retail-banking sector. The starting point in the empirical analysis involves conducting multiple structural break analysis. Given that during the period under investigation, there have been significant milestones in the history of the European single market, the deposit and lending rates corresponding to this period are likely to exhibit structural change. Moreover, the timing and pattern of structural break occurrence should also act as an indicator of retail banking integration. The next steps in the empirical analysis look at stationarity tests for both time series data and panel data on data series that are also individually demeaned so as to account for structural breaks. Finally, bivariate time-series cointegration analysis on each of the EU countries and a weighted European average rate is performed. The cointegration analysis is performed on both level and demeaned data.

AB - This paper investigates the degree of integration in the retail-banking sector for 15 European Union member states between the period 1991 to March 2008. In view of consolidating and creating a single market in their financial services sector, the EU has launched and implemented major initiatives over the past years. The wholesale banking sector has been studied extensively but the retail market to a much lesser extent. The difficulty in analysing the integration process in the banking market is linked to the heterogeneity that exists across the European countries with regards to factors such as risk attitudes, cultural differences, and the home-bias criteria. As a result, it is argued that any convergence process in the banking sector, if present, should rather be perceived as a long-run relationship. Consequently, cointegration analysis, a technique used to capture such long-term relationships between sets of variables is used to analyse the integration process in the EU retail-banking sector. The starting point in the empirical analysis involves conducting multiple structural break analysis. Given that during the period under investigation, there have been significant milestones in the history of the European single market, the deposit and lending rates corresponding to this period are likely to exhibit structural change. Moreover, the timing and pattern of structural break occurrence should also act as an indicator of retail banking integration. The next steps in the empirical analysis look at stationarity tests for both time series data and panel data on data series that are also individually demeaned so as to account for structural breaks. Finally, bivariate time-series cointegration analysis on each of the EU countries and a weighted European average rate is performed. The cointegration analysis is performed on both level and demeaned data.

KW - Retail banking

M3 - Discussion paper

T3 - Centre for Int Capital Markets Discussion Papers

BT - Integration in the European Retail Banking Sector

ER -