The operation of the Mexican banking system under foreign multinational corporations’ control: new activities and traditional income

Noemi Levy-Orlik, Christian Dominguez-Blancas

Research output: Contribution to journalScientific review

2 Citations (Scopus)

Abstract

© 2016 Taylor & Francis. Abstract: This paper discusses the operation of banks in developing economies dominated by foreign multinational corporations (FMCs), and argues that banks have acquired new activities without drastically modifying the composition of their income. This discussion takes place in the light of the profound changes in financial systems that have modified the linkages between banks, capital markets, businesses and households, during the period of globalization and financialization. The main argument of this paper is that although foreign multinational corporations have become dominant in developing countries, and bank activities have diversified, the multinational corporations of the banking sector still rely on interest margins, particularly from consumer credit. This is explained in terms of specific bank credit activities that operate under oligopolistic structures, a condition that has not being modified by foreign multinational corporations’ dominance in developing banking markets.
Original languageAmerican English
Pages (from-to)527-546
Number of pages472
JournalInternational Review of Applied Economics
DOIs
StatePublished - 3 Jul 2016

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Banking system
Income
Multinational corporations
Capital markets
Interest margin
Bank credit
Banking
Consumer credit
Linkage
Financial system
Developing countries
Household
Financialization
Developing economies
Bank capital
Globalization
Banking sector

Cite this

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abstract = "{\circledC} 2016 Taylor & Francis. Abstract: This paper discusses the operation of banks in developing economies dominated by foreign multinational corporations (FMCs), and argues that banks have acquired new activities without drastically modifying the composition of their income. This discussion takes place in the light of the profound changes in financial systems that have modified the linkages between banks, capital markets, businesses and households, during the period of globalization and financialization. The main argument of this paper is that although foreign multinational corporations have become dominant in developing countries, and bank activities have diversified, the multinational corporations of the banking sector still rely on interest margins, particularly from consumer credit. This is explained in terms of specific bank credit activities that operate under oligopolistic structures, a condition that has not being modified by foreign multinational corporations’ dominance in developing banking markets.",
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AB - © 2016 Taylor & Francis. Abstract: This paper discusses the operation of banks in developing economies dominated by foreign multinational corporations (FMCs), and argues that banks have acquired new activities without drastically modifying the composition of their income. This discussion takes place in the light of the profound changes in financial systems that have modified the linkages between banks, capital markets, businesses and households, during the period of globalization and financialization. The main argument of this paper is that although foreign multinational corporations have become dominant in developing countries, and bank activities have diversified, the multinational corporations of the banking sector still rely on interest margins, particularly from consumer credit. This is explained in terms of specific bank credit activities that operate under oligopolistic structures, a condition that has not being modified by foreign multinational corporations’ dominance in developing banking markets.

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