Tianshu Zhao

Regulatory Reform and Productivity Change in Indian Banking

This paper examines the impact of regulatory reform on productivity growth and its components for Indian banks from 1992 to 2009. We estimate parametric and nonparametric efficiency frontiers, followed by Divisia and Malmquist indexes of total factor productivity, respectively. To account for technology heterogeneity among ownership types, we use a metafrontier approach. Results are consistent across methodologies and show sustained productivity growth, driven mainly by technological progress. Furthermore, results indicate that different ownership types react differently to changes in the operating environment. The position of foreign banks becomes increasingly dominant, and their production technology becomes the best practice in the industry.

Financial Reforms, Competition, and Risk in Banking Markets

The analysis of the relationship between financial reforms, competition, and bank risk-taking incentives is of particular interest in the wake of the recent financial turmoil, as banks and regulators are currently facing unprecedented challenges. As new regulations and infrastructures are created and the old ones discarded or reformed, it is necessary to foster understanding of the implications of the crisis on the banking sector.

Relationship banking and regional SME financing: the case of Wales

Regional disparities in credit availability across the UK have been highlighted in a series of studies as a factor affecting both new firm starts and small firm growth prospects. This paper suggests that relationship banking might be an important means of attenuating differences in credit availability. The paper focuses on the value of relationship banking to SMEs in Wales in the period following the global banking crisis. The results show that SMEs that had developed a customer-loan relationship with their banks had a lower probability of experiencing a worsened credit outcome than those that did not. The implications of the findings for regional finance provision are discussed.