A Comparative Study of Efficiency in European Banking

The structure of European banking markets has substantially changed over the past decade, partially as a result of the creation of the Single Internal Market. The process of integration and accompanying deregulation has embodied an incentive for bank management to focus on improving efficiency, especially given the more competitive banking environment. In this paper, employing the non-parametric DEA approach, we investigate whether the productive efficiency of European banking systems has improved and converged towards a common European frontier between 1993 and 1997, following the process of EU legislative harmonisation. We also examine the determinants of European bank efficiency using a Tobit regression model approach. We then extend the established literature on the determinants bank efficiency by taking into account the problem of the inherent dependency of DEA efficiency scores when used in regression analysis. To overcome the dependency problem a bootstrapping technique is applied. Overall, the results suggest that since the EU's Single Market Programme there has been a small improvement in bank efficiency levels, although there is little evidence to suggest that these have converged. Efficiency differences across European banking markets appear to be mainly determined by country-specific factors.Efficiency, DEA, Bootstrap, European Banks.

The relationship between self-blame for the onset of a chronic physical health condition and emotional distress : a systematic literature review

Objective: Past literature presents contrasting perspectives regarding the potential influence of self-blame on adjustment to illness. This systematic literature review aimed to summarise findings from all investigations to date that have explored the relationship between self-blame for the onset of a chronic physical health condition and emotional distress. Method: Between November 2014 and February 2015 electronic databases were searched for relevant literature. Only those studies which assessed self-blame directly and related specifically to illness onset were included within the review. The methodological and reporting quality of all eligible articles was assessed and themes within the findings were discussed using a narrative synthesis approach. Results: The majority of studies found self-blame to be associated with increased distress. However, several concerns with the quality of the reviewed articles may undermine the validity of their conclusions. Conclusions: It is important for professionals supporting people with chronic physical health conditions to have an understanding of how of self-critical causal attributions might relate to emotional distress. Further research is required to understand the concept of self-blame, the factors that may encourage this belief and to develop reliable and valid measures of this experience

Why UK banks are like public utilities - and should be regulated as such

Banks have economic features similar to those of utility service providers – which are typically regulated more heavily than other companies – writes Phil Molyneux. He explains how banks ought to be regulated with this point in mind, and concludes that greater regulatory oversight of bank pricing and service provision is necessary

Regulations and productivity growth in banking

This paper examines the relationship between the regulatory and supervision framework and the productivity of banks in 22 countries over the period 1999-2006. We follow a semi-parametric two-step approach that combines Malmquist index estimates with bootstrap regressions. The results indicate that regulations and incentives that promote private monitoring have a positive impact on productivity. Restrictions on banks’ activities relating to their involvement in securities, insurance, real estate and ownership of non-financial firms also have a positive impact. However, regulations relating to the first and second pillars of Basel II, namely capital requirements and official supervisory power do not appear to have a statistically significant impact on productivity.Banks; Basel II; Productivity; Regulations

Cross-Country Comparisons of Competition and Pricing Power in European Banking

Studies of banking competition and competitive behaviour both within and across countries typically utilise only one of the few measures that are available. In trying to assess the relative competitive position of banking markets in 14 European countries, we find that the existing indicators of competition often give conflicting predictions, both across countries and over time. Seeking greater consistency, we attempt to separate bank pricing power from other, non-core, influences embodied in competition measures. While there is some improvement in cross-country consistency, the main result is that our measure of bank pricing power suggests that banking market competition in Europe may well be stronger than implied by traditional measures and analysis.Competition; banking

Development of a new running gear for the Spectrum intermodal vehicle

The European Union (EU) Seventh Framework Programme (FP7) project Spectrum [12] set out to develop a freight vehicle which would facilitate the exploitation of the low density, high value (LDHV) goods market. Key to the performance criteria for the vehicle were: increased speed to enable mixed running with passenger services; improved ride quality to avoid damage to the LDHV goods; and reduced track damage for longevity and sustainability on increasingly stressed infrastructure. This paper presents aspects of the development of a novel running gear arrangement for the Spectrum vehicle, focussing on the dynamic performance of a Vampire vehicle model and the steps to realising stable running. Finally, the estimated performance of the Spectrum vehicle concept is compared against calculations for a conventional freight wagon with respect to curving, vertical track forces and potential savings in track access charges through implementation of Network Rail’s Variable Track Access Charge Calculator. It was found that the novel Spectrum concept could offer savings in Variable Usage Charges of between 8% and 16% compared to the conventional equivalent

The Spectrum Bogie

This poster, providing an overview of the Spectrum freight bogie, was presented at the Railway Engineers Forum (REF) Technical Seminar held at the Institution of Civil Engineers on the 15th June 2015

Do different forms of government ownership matter for bank capital behavior? Evidence from China

This study attempts to reconcile the conflicting theoretical predictions regarding how government ownership affects bank capital behaviour. Using a unique Chinese bank dataset over 2006-2015 we find that government-owned banks have higher target capital ratios and adjust these ratios faster compared to private banks, supporting the ‘development/political’ view of the government’s role in banking. This effect is stronger for local government-owned and state enterprise-owned banks than for central government-owned banks. We also find that undercapitalized government-owned banks increase equity while undercapitalized foreign banks contract assets and liabilities as their respective main strategy to adjust their capital ratios

Bank Margins and Profits in a World of Negative Rates

By investigating the influence of negative interest rate policy (NIRP) on bank margins and profitability, this paper identifies country- and bank- specific characteristics that amplify or weaken the effect of NIRP on bank performance. Using a dataset comprising 7,359 banks from 33 OECD member countries over 2012\u201316 and a difference-in-differences methodology, we find that bank margins and profits fell in NIRP-adopter countries compared to countries that did not adopt the policy. Moreover, this adverse NIRP effect depends on bank specific-characteristics such as size, funding structure, business models, assets repricing and product \u2013 line specialization. The effectiveness of the pass-through mechanism of NIRP can also be affected by the characteristics of a country's banking system, namely, the level of competition and the prevalence of fixed/floating lending rates