This paper examines the determinants of foreign bank entry in South East Asian countries after significant policy changes following the regional financial crisis in 1997/1998. The results show that manufacturing FDI and bilateral trade exert weak impacts on the decision of entry by foreign banks, providing little evidence for the argument that banks follow their home customers abroad. In contrast, local profit opportunities appear to be the prominent factor attracting foreign bank penetration in South East Asia. The results are robust to different modelling techniques.
- Foreign bank entry and motivation
- Foreign ownership
- South East Asian banking
ASJC Scopus subject areas
- Economics and Econometrics