Open AccessThe Brazilian Banking Industry: A Study of the Entry Barriers to Foreign Institutions
Author(s) -
Juliana Rabelo Melo,
Sérgio Henrique Arruda Cavalcante Forte,
José Milton de Sousa Filho
Publication year - 2014
Publication title -
revista ibero-americana de estratégia
Language(s) - English
Resource type - Journals
ISSN - 2176-0756
DOI - 10.5585/ijsm.v13i3.2105
Subject(s) - business , barriers to entry , logistic regression , banking industry , descriptive statistics , variables , financial system , market structure , industrial organization , medicine , statistics , mathematics , machine learning , computer science
Brazil began 2013 year with the announcement of the Central Bank of Brazil (BCB) on whether to authorize the entry of new nineteen foreign banks. Moreover, there are barriers to entry in any market. They are structural and can be hardly changed by potential entrants. The research investigates what are the entry barriers the foreign banks will face in the Brazilian market. The theory indicated the barriers should be surveyed, and other specific barriers emerged from consultation with 112 experts from the banking market. They were divided into market barriers and institutional barriers. The research consulted in 2013 the national regulator bank (BCB) and 39 domestic and foreign banks. The analysis was descriptive and explanatory using factor analysis and logistic regression. For the analysis it was considered as dependent variable the type of bank (domestic or foreign), and as predictors variables the entry barriers. As a result, it was seen that the barriers of market are representative and the institutional barriers showed no significance, which shows the strength of the banking industry in Brazil