Can Good Governance Lower Financial Intermediation Costs? /

This paper argues that better governance practices can reduce the costs, risks and uncertainty of financial intermediation. Our sample covers high-, middle- and low-income countries before and after the global financial crisis (GFC). We find that net interest margins of banks are lower if various go...

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Bibliographic Details
Main Author: Jarmuzek, Mariusz
Other Authors: Lybek, Tonny
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 2018.
Series:IMF Working Papers; Working Paper ; No. 2018/279
Online Access:Full text available on IMF
Description
Summary:This paper argues that better governance practices can reduce the costs, risks and uncertainty of financial intermediation. Our sample covers high-, middle- and low-income countries before and after the global financial crisis (GFC). We find that net interest margins of banks are lower if various governance indicators are better. More cross-border lending also appears conducive to lower intermediation costs, while the level of capital market development is not significant. The GFC seems not to have had a strong impact except via credit risk. Finally, we estimate the size of potential gains from improved governance.
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Physical Description:1 online resource (43 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Access:Electronic access restricted to authorized BRAC University faculty, staff and students