Template-type: ReDIF-Paper 1.0
Author-Name: Martin Brown
Author-Name-First: Martin
Author-Name-Last: Brown
Author-Person: pbr129
Author-Name: Maria Clara Rueda Maurer
Author-Name-First: Maria Clara
Author-Name-Last: Rueda Maurer
Author-Name: Tamara Pak
Author-Name-First: Tamara
Author-Name-Last: Pak
Author-Name: Nurlanbek Tynaev
Author-Name-First: Nurlanbek
Author-Name-Last: Tynaev
Title: Banking Sector Reform and Interest Rates in Transition Economies: Bank-Level Evidence from Kyrgyzstan
Abstract: We examine the impact of banking sector reforms on interest rates using bank-level data from Kyrgyzstan for 1998-2005. We find that increased confidence in the banking sector has contributed significantly to lowering interest rate levels, while the impact of lower intermediation costs, credit risk, and capital costs are negligible. Our results further suggest that the liberalization of the Kyrgyz financial sector has reduced both deposit and lending rates. Finally, we find that despite considerable restructuring, the Kyrgyz banking sector has not become more competitive. As a consequence, banks' interest rates have not fully responded to lower market rates following macroeconomic stabilization.
Length: 34 pages
Creation-Date: 2007
Contact-Email: forschung@snb.ch
File-URL: https://www.snb.ch/en/publications/research/working-papers/2007/working_paper_2007_07
File-Format: text/html
Number: 2007-07
Classification-JEL: G21, O16, P34
Keywords: Transition, Financial Sector Development, Interest Rates
Handle: RePEc:snb:snbwpa:2007-07