Banking Industry Structure and Economic Activities: A Regional Approach for the Philippines

  • Jessica A. Los Banos U.P. College of Business Administration
  • Celine Meslier Crouzille Université de Limoges
  • Emmanuelle Nys Université de Limoges
  • Alain Sauviat Université de Limoges

Abstract

This paper examines the link between banking industry structure and economic activity at the regional level in the Philippines. We apply a principal component analysis on regional banking and economic data for the period 1993 to 2005. We ranked the sixteen regions in three different groups depending on their average economic development. Our results show globally a positive link between regional indicators of economic development and banking development with a specific influence of rural banking mainly in the intermediate-developed regions, which is reinforced after the 1997 financial crisis. For the less developed regions, the more rural in the Philippines, commercial, thrift or rural banks do not seem to provide any significant contribution to economic development.

Author Biographies

Jessica A. Los Banos, U.P. College of Business Administration
Assistant Professor, Marketing, Department of Business Administration
Celine Meslier Crouzille, Université de Limoges
Laboratoire d’Analyse et Prospective Économiques (LAPE)
Emmanuelle Nys, Université de Limoges
Laboratoire d’Analyse et Prospective Économiques (LAPE)
Alain Sauviat, Université de Limoges
Laboratoire d’Analyse et Prospective Économiques (LAPE)
Published
2011-04-13
Issue
Vol 18 (2011)
Section
Articles

Keywords

financial development; regional economic development; banking industry structure; principal component analysis