Competitive And Collaborative Strategies The Impacts In The Performance Of The Brazilian Banking Industry PDF Download

This paper aims at analyzing the main determinants and impacts of the recent wave of European banks entering Brazil. The principal hypothesis of the paper is that the wave of European banks can only be understood if one considers both external and internal determinants. External determinants concern the process of banking consolidation in the European financial system under the EMU that has stimulated some banks to expand abroad. Internal determinants are mainly related to the gradual flexibilisation of legal restrictions with respect to the presence of foreign banks in the Brazilian banking sector. Finally, the paper evaluates the impacts of the recent entry of European banks into the retail banking market in Brazil. In this particular matter, it shows that foreign entry has affected the national banking market forcing domestic banks to operate more efficiently, and also to expand their activities organically or by mergers and acquisitions. The paper concludes that there is no clear evidence that foreign banks have been more efficient than domestic banks in Brazil in the recent period, but there is some evidence that the big private Brazilian banks have reacted positively to the entry of foreign banks.