FOREIGN BANK ENTRY IMPACTED DOMESTIC-OWNED BANKS IN GHANA FROM 1975 TO 2008

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Nsiah K. Acheampong

https://doi.org/10.22495/jgr_v2_i4_p5

Abstract

This article empirically examines the effects of foreign bank entry on the financial performance of Merchant Bank Ghana Limited and Ghana Commercial Banks Limited in Ghana from 1975 to 2008. The main result of the pooled regression was that foreign bank entry relatively increased domestic banks’ return on assets for the period 1992-2008; a period with a high influx of foreign banks into Ghana. This result supported the studies by Beck, Demirguc-Kunt, and Levine (2006) and Boldrin and Levine (2009) that found that foreign bank entry enhanced domestic banks profitability margins. The presence of foreign-owned banks was not detrimental to the financial performance of the domestic-owned banks in Ghana.

Key Words: Emerging Market Economies (EMEs), Foreign Bank Entry, Ghanaian-Owned Banks, Pooled Analysis

How to cite this paper: Acheampong, N. K. (2013). Foreign bank entry impacted domestic-owned banks in Ghana from 1975 to 2008. Journal of Governance and Regulation, 2(4), 40-53. https://doi.org/10.22495/jgr_v2_i4_p5