Interbank market structure, bank conduct, and performance: evidence from the UK

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dc.cclicenceCC-BY-NC-NDen
dc.contributor.authorLartey, Theophilus
dc.contributor.authorJames, Gregory A.
dc.contributor.authorDanso, Albert
dc.contributor.authorBoateng, Agyenim
dc.date.acceptance2023-04-06
dc.date.accessioned2023-04-24T08:42:05Z
dc.date.available2023-04-24T08:42:05Z
dc.date.issued2023-04-13
dc.descriptionopen access articleen
dc.description.abstractWe examine whether a concentrated interbank market stimulates bank collusion or monopolistic pricing towards enhancing performance. We explore this nexus by incorporating the role of bank conduct into the structure–performance paradigm. The results show that the interbank market structure provides a channel for banks to collude and engage in monopolistic pricing in the market for bank and business loans to consequently increase bank performance. Further, while the interbank market structure is both profit and cost efficient for non-conglomerate banks, it is cost efficient for foreign banks. Hence, collusion and other anti-competitive behaviours in the interbank market may exacerbate incentives for foreign and non-conglomerate bank entry. We also explored the theoretical and policy implications of these findings. Our results are robust to alternative measures of market structure, bank conduct and performance, and the use of a wide range of specifications and econometric models.en
dc.funderNo external funderen
dc.identifier.citationLartey, T., James, G.A., Danso, A. and Boateng, A. (2023) Interbank market structure, bank conduct, and performance: Evidence from the UK. Journal of Economic Behavior & Organization, 210, pp. 1-25en
dc.identifier.doihttps://doi.org/10.1016/j.jebo.2023.04.005
dc.identifier.issn1879-1751
dc.identifier.urihttps://hdl.handle.net/2086/22734
dc.language.isoen_USen
dc.peerreviewedYesen
dc.publisherElsevieren
dc.researchinstituteFinance and Banking Research Group (FiBRe)en
dc.subjectmarket structureen
dc.subjectbank conducten
dc.subjectperformanceen
dc.subjectownershipen
dc.subjectconsolidationen
dc.titleInterbank market structure, bank conduct, and performance: evidence from the UKen
dc.typeArticleen

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