Title: Are banks in financial conglomerates more profitable than other commercial banks? Evidence of banking sectors in Visegrad countries

Authors: Iveta Palečková

Addresses: School of Business Administration in Karviná, Silesian University in Opava, Univerzitní náměstí 1934/3, Karviná, 733 40, Czechia

Abstract: The aim of this paper is to estimate whether banks that belong to financial conglomerates are more profitable than other banks in the banking sector in the Visegrad countries. In line with the aim of the paper, the research question is as follows: Are there differences in profitability between banks that belong to a financial conglomerate and other banks in the banking industry in the Visegrad countries? We investigated banks from four financial conglomerates and estimated the profitability of commercial banks in the Visegrad countries. We found that the profitability of the banking sector in the Visegrad countries was low. Using a matching method, we found that there were significant differences between banks that belong to a financial conglomerate and other banks in the banking sector. Commercial banks that belong to a financial conglomerate were more profitable than other banks in the banking sectors in the Visegrad countries.

Keywords: ROA; return on assets; ROE; return on equity; NIM; net interest margin; cost to income ratio; banking sector; financial conglomerate; propensity score matching; Visegrad countries.

DOI: 10.1504/IJTGM.2018.097278

International Journal of Trade and Global Markets, 2018 Vol.11 No.4, pp.231 - 242

Received: 12 Dec 2017
Accepted: 31 Jan 2018
Published online: 07 Jan 2019 *

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