Performance Characteristics of Private and State‐Owned Banks: The Turkish Case

Abstract

This paper investigates the performance characteristics of Turkish private and state‐owned commercial banks for the 1986– 1990 period. The link between interest margins and maturity structures of bank asset and liabilities is specified. Empirical evidence indicates that banks with longer positions experienced lower interest margins, a finding consistent with the presence of a downward sloping yield curve during most of this period. The results document that bank margins suffered after the financial reforms of 1988. Further, compared to private banks, state‐owned banks exhibited lower interest margins and longer maturities, which is a direct consequence of portfolio constraints and management style of banks.

Citation

Aydogan, K. and Geoffrey Booth, G. (1996), "Performance Characteristics of Private and State‐Owned Banks: The Turkish Case", Managerial Finance, Vol. 22 No. 10, pp. 18-39. https://doi.org/10.1108/eb018584