Competition and efficiency of selected universal banks in the Philippines for the year 2011

• Main Author: Lim, Edralin C.
• Format: text
• Published: Animo Repository 2013
• Subjects: Universal banks—Philippines; Competition—Philippines; Finance and Financial Management
• Online Access: https://animorepository.dlsu.edu.ph/faculty_research/6721
• Institution: De La Salle University

The researcher based his sample on nine universal banks in the Philippines from 2003 to 2011. This research used a correlational analysis to determine the relationship between competition and bank efficiency. The scope of the study is limited to the removal of entry barriers which is one of the six policies of financial liberalization that allowed the entry of the ten foreign banks. To assess the competition among universal banks, Herfindahl index (HI) was used. The study showed that financial liberalization brought greater competition, improved efficiency and less market concentration. It showed that Herfindahl index is negatively related with net interest margin to assets and loan to asset ratio. It also showed that Herfindahl index is positively related with provision for loan losses ratio.