The Effect of Information and Communication Technologies Penetration on Banking Intermediation Efficiency: Panel Study

Öz

In this study, we analyze the impact of ICT penetration on banking intermediation efficiency, as measured by interest spreads and interest margins. We use unbalanced panel data to explore how ICT usage affects the efficiency of financial intermediation after controlling for other macroeconomic determinants of spreads and margins. Highly statistically significant negative correlations between three ICT penetration indicators and both interest spreads and interest margins are identified by using both univariate and multivariate time effect models. Our results suggest that ICT penetration enhance banking intermediation efficiency by reducing interest spreads and margins. 

Anahtar Kelimeler

• ICT Penetration,Banking Intermediation Efficiency,Interest Spreads

Kaynakça

1. Afanasieff, T.S. , Lhacer, P. M. V., Nakane, M. I. (2002). The Determinants of Bank Interest Spread in Brazil, Central Bank of Brazil Working Paper No: 46. Brazil: Central Bank of Brazil.
2. Beck, T., Hesse, H. (2006). Bank Efficiency, Ownership and Market Structure Why Are Interest Spreads so High in Uganda? World Bank Policy Research Working Paper 4027. Washington D.C.: World Bank.
3. Dabla-Norris, E., Floerkemeier, H. (2007). Bank Efficiency and Market Structure: What Determines Banking Spreads in Armenia? IMF Working Paper WP/07/134. Washington D.C.: IMF.
4. Demirguc-Kunt, A., Huizinga, H. (1999). Determinants of Commercial Bank Interest Margins and Profitability: Some International Evidence. World Bank Economic Review, 13(2), 379-408.
5. Dietrich, A., Wanzenried, G., Cole, R. A. (2015). Why Are Net-Interest Margins Across Countries so Different? Retrieved from https://ssrn.com/abstract=1542067.
6. Fofack, A. D. (2016). The Determinants of Interest Rate Spread: Empirical Evidence from the Central African Economic and Monetary Community. Journal of Economics and International Finance, 8(6), 66-88.
7. Gelos, R. G. (2006). Banking Spreads in Latin America, IMF Working Paper WP/06/44. Washington D.C.: IMF.
8. Horvath, R. (2009). The Determinants of the Interest Rate Margins of Czech Banks. Czech Journal of Economics and Finance, 59 (2), 128-136.

9. Huybens, E., Smith, B. (1999). Inflation, Financial Markets, and Long-Run Real Activity. Journal of Monetary Economics, 43(2), 283-315.
10. Martinez Peria, M. S., Mody, A. (2004). How Foreign Participation and Market Concentration Impact Bank Spreads: Evidence from Latin America. Journal of Money, Credit and Banking, 36(3), 511-37.