Bank ownership, regulation and efficiency: Perspectives from the Middle East and North Africa (MENA) Region

Haque, Faizul and Brown, Kym (2017) Bank ownership, regulation and efficiency: Perspectives from the Middle East and North Africa (MENA) Region. International Review of Economics and Finance, 47, 273-293. (doi:10.1016/j.iref.2016.10.015).

Record type: Article

Abstract

This paper examines the effects of bank regulation and ownership on the efficiency of banks in the emerging MENA region. The public and private view of bank regulation is tested along with the interaction of bank regulation and ownership. Results support the public view of bank regulation and suggest that both ownership concentration and supervisory power individually and interactively exert a positive influence on cost efficiency. Moreover, government ownership, capital stringency and market power have positive effects on cost efficiency, whereas activity restrictions and deposit insurance have opposite effects. Capital regulation and supervisory power improvements occurred since Basel II.

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Accepted/In Press date: 26 October 2016

e-pub ahead of print date: 3 November 2016

Published date: 1 January 2017

Additional Information: Funding Information: The authors would like to thank the Editor and two anonymous reviewers for their helpful suggestions. The authors acknowledge the internal research grants (IRG Round 1/December2011) received from the School of Management, Heriot-Watt University . We would also like to sincerely thank participants at the “Paris Financial Management Conference 2014” and Mustafa Caglayan for helpful suggestions. Publisher Copyright: © 2016 Copyright: Copyright 2016 Elsevier B.V., All rights reserved.

Keywords: Bank efficiency, Bank regulation, MENA, Ownership