The brazilian banking concentration process
sectoral analysis of the period from 1995 to 2017
Keywords:
Banking concentration, Strategy, Mergers and acquisitions, Hirschman-Herfindahl IndexAbstract
In view of the difficulties faced by banking institutions in crisis and economic recovery scenarios, mergers and acquisitions became crucial strategies for financially sound banks, which contributed to the reduction in the number of financial institutions in brazil since the implementation of the real plan in 1994. the objective of this study is to understand the process of bank concentration in brazil from 1995 to 2017. for this, the hirschman - herfindahl concentration index was calculated for the years of the period under analysis, considering three different variables: 1) total assets, 2) total deposits and 3) credit operations. the degree of concentration of the banks by the three variables analyzed followed an upward trend and pointed to a moderate concentration of the banking industry in 2017. the strategy of growth of financial institutions, due to mergers and acquisitions, was important for the concentration of the brazilian banking sector, characterized especially by five financial institutions in 2017: banco do brasil, caixa econômica federal, itaú, bradesco and santander.
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