@techreport{65685,
  abstract     = {{Employing a unique hand-collected sample of 881 securitization transactions issued by 59 stock-listed banks across the EU-13 plus Switzerland over the period from 1997 to 2010, this paper empirically investigates if and how market power in the loan and deposit market may influence European banks’ incentives to engage in securitization activities. We construct product-specific residual Lerner Indices to measure market power in the loan and deposit market separately. Our results suggest that banks with higher loan and deposit market power securitize less, consistent with a reduced need for risk transfer and a reduced reliance on market-based funding. Various sensitivity analyses further show that these relationships vary across underlyings, issuance frequencies, and different time stages of securitization in Europe. Our findings contribute to the literature by disentangling loan and deposit market power as two further distinct determinants of securitization and thus, offer important insights regarding the ongoing policy debates on the consolidation of European banking markets and the revitalisation of the European securitization market.}},
  author       = {{Herwald, Sarah and Uhde, André}},
  keywords     = {{Securitization, market power, European banking}},
  title        = {{{Securitization and Market Power – Evidence from European Banks}}},
  year         = {{2026}},
}

@article{62999,
  abstract     = {{<jats:sec><jats:title content-type="abstract-subheading">Purpose</jats:title><jats:p>Academic research has intensively analyzed the relationship between market concentration or market power and banking stability but provides ambiguous results, which are summarized under the concentration-stability/fragility view. We provide empirical evidence that the mixed results are due to the difficulty of identifying reliable variables to measure concentration and market power.</jats:p></jats:sec><jats:sec><jats:title content-type="abstract-subheading">Design/methodology/approach</jats:title><jats:p>Using data from 3,943 banks operating in the European Union (EU)-15 between 2013 and 2020, we employ linear regression models on panel data. Banking market concentration is measured by the Herfindahl–Hirschman Index (HHI), and market power is estimated by the product-specific Lerner Indices for the loan and deposit market, respectively.</jats:p></jats:sec><jats:sec><jats:title content-type="abstract-subheading">Findings</jats:title><jats:p>Our analysis reveals a significantly stability-decreasing impact of market concentration (HHI) and a significantly stability-increasing effect of market power (Lerner Indices). In addition, we provide evidence for a weak (or even absent) empirical relationship between the (non)structural measures, challenging the validity of the structure-conduct-performance (SCP) paradigm. Our baseline findings remain robust, especially when controlling for a likely reverse causality.</jats:p></jats:sec><jats:sec><jats:title content-type="abstract-subheading">Originality/value</jats:title><jats:p>Our results suggest that the HHI may reflect other factors beyond market power that influence banking stability. Thus, banking supervisors and competition authorities should investigate market concentration and market power simultaneously while considering their joint impact on banking stability.</jats:p></jats:sec>}},
  author       = {{Herwald, Sarah and Voigt, Simone and Uhde, André}},
  issn         = {{1526-5943}},
  journal      = {{The Journal of Risk Finance}},
  number       = {{3}},
  pages        = {{510--536}},
  publisher    = {{Emerald}},
  title        = {{{The impact of market concentration and market power on banking stability – evidence from Europe}}},
  doi          = {{10.1108/jrf-03-2023-0075}},
  volume       = {{25}},
  year         = {{2024}},
}