Concentration and efficiency in the Vietnamese banking system between 1999 and 2009: A structural model approach
Journal of Financial Regulation and Compliance
ISSN: 1358-1988
Article publication date: 19 July 2013
Abstract
Purpose
The purpose of this paper is to examine the degree of concentration and efficiency in the Vietnamese banking system using the structural model.
Design/methodology/approach
The authors apply the concentration ratio (CR), Herfindahl‐Hirschman Index (HHI) and concentration‐profitability model based upon the Structure‐Conduct‐Performance (SCP) and Efficiency Hypothesis (EH) approaches to examine 48 Vietnamese commercial banks over the period 1999‐2009.
Findings
The authors' empirical results show that the Vietnamese banking industry has become substantially less concentrated; however, large commercial banks still dominate the whole banking system. Further, their results do not support either the traditional Structure‐Conduct‐Performance or the Efficiency Hypothesis.
Practical implications
The State Bank of Vietnam needs to have policies for restructuring the system and promoting competition in the banking sector of Vietnam.
Originality/value
This is the first such study of the Vietnamese banking system.
Keywords
Citation
Ngoc Nguyen, T. and Stewart, C. (2013), "Concentration and efficiency in the Vietnamese banking system between 1999 and 2009: A structural model approach", Journal of Financial Regulation and Compliance, Vol. 21 No. 3, pp. 268-283. https://doi.org/10.1108/JFRC-10-2012-0041
Publisher
:Emerald Group Publishing Limited
Copyright © 2013, Emerald Group Publishing Limited