---
_id: '65685'
abstract:
- lang: eng
  text: 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:
- first_name: Sarah
  full_name: Herwald, Sarah
  id: '51867'
  last_name: Herwald
- first_name: André
  full_name: Uhde, André
  id: '36049'
  last_name: Uhde
citation:
  ama: Herwald S, Uhde A. <i>Securitization and Market Power – Evidence from European
    Banks</i>.; 2026.
  apa: Herwald, S., &#38; Uhde, A. (2026). <i>Securitization and Market Power – Evidence
    from European Banks</i>.
  bibtex: '@book{Herwald_Uhde_2026, title={Securitization and Market Power – Evidence
    from European Banks}, author={Herwald, Sarah and Uhde, André}, year={2026} }'
  chicago: Herwald, Sarah, and André Uhde. <i>Securitization and Market Power – Evidence
    from European Banks</i>, 2026.
  ieee: S. Herwald and A. Uhde, <i>Securitization and Market Power – Evidence from
    European Banks</i>. 2026.
  mla: Herwald, Sarah, and André Uhde. <i>Securitization and Market Power – Evidence
    from European Banks</i>. 2026.
  short: S. Herwald, A. Uhde, Securitization and Market Power – Evidence from European
    Banks, 2026.
date_created: 2026-05-26T11:29:46Z
date_updated: 2026-05-27T06:50:46Z
ddc:
- '040'
department:
- _id: '19'
file:
- access_level: closed
  content_type: application/pdf
  creator: sherwald
  date_created: 2026-05-26T11:10:31Z
  date_updated: 2026-05-26T11:10:31Z
  file_id: '65688'
  file_name: Herwald und Uhde (2026).pdf
  file_size: 681627
  relation: main_file
  success: 1
file_date_updated: 2026-05-26T11:10:31Z
has_accepted_license: '1'
jel:
- G21
- G28
keyword:
- Securitization
- market power
- European banking
language:
- iso: eng
status: public
title: Securitization and Market Power – Evidence from European Banks
type: working_paper
user_id: '51867'
year: '2026'
...
---
_id: '62999'
abstract:
- lang: eng
  text: <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:
- first_name: Sarah
  full_name: Herwald, Sarah
  id: '51867'
  last_name: Herwald
- first_name: Simone
  full_name: Voigt, Simone
  id: '50109'
  last_name: Voigt
- first_name: André
  full_name: Uhde, André
  id: '36049'
  last_name: Uhde
citation:
  ama: Herwald S, Voigt S, Uhde A. The impact of market concentration and market power
    on banking stability – evidence from Europe. <i>The Journal of Risk Finance</i>.
    2024;25(3):510-536. doi:<a href="https://doi.org/10.1108/jrf-03-2023-0075">10.1108/jrf-03-2023-0075</a>
  apa: Herwald, S., Voigt, S., &#38; Uhde, A. (2024). The impact of market concentration
    and market power on banking stability – evidence from Europe. <i>The Journal of
    Risk Finance</i>, <i>25</i>(3), 510–536. <a href="https://doi.org/10.1108/jrf-03-2023-0075">https://doi.org/10.1108/jrf-03-2023-0075</a>
  bibtex: '@article{Herwald_Voigt_Uhde_2024, title={The impact of market concentration
    and market power on banking stability – evidence from Europe}, volume={25}, DOI={<a
    href="https://doi.org/10.1108/jrf-03-2023-0075">10.1108/jrf-03-2023-0075</a>},
    number={3}, journal={The Journal of Risk Finance}, publisher={Emerald}, author={Herwald,
    Sarah and Voigt, Simone and Uhde, André}, year={2024}, pages={510–536} }'
  chicago: 'Herwald, Sarah, Simone Voigt, and André Uhde. “The Impact of Market Concentration
    and Market Power on Banking Stability – Evidence from Europe.” <i>The Journal
    of Risk Finance</i> 25, no. 3 (2024): 510–36. <a href="https://doi.org/10.1108/jrf-03-2023-0075">https://doi.org/10.1108/jrf-03-2023-0075</a>.'
  ieee: 'S. Herwald, S. Voigt, and A. Uhde, “The impact of market concentration and
    market power on banking stability – evidence from Europe,” <i>The Journal of Risk
    Finance</i>, vol. 25, no. 3, pp. 510–536, 2024, doi: <a href="https://doi.org/10.1108/jrf-03-2023-0075">10.1108/jrf-03-2023-0075</a>.'
  mla: Herwald, Sarah, et al. “The Impact of Market Concentration and Market Power
    on Banking Stability – Evidence from Europe.” <i>The Journal of Risk Finance</i>,
    vol. 25, no. 3, Emerald, 2024, pp. 510–36, doi:<a href="https://doi.org/10.1108/jrf-03-2023-0075">10.1108/jrf-03-2023-0075</a>.
  short: S. Herwald, S. Voigt, A. Uhde, The Journal of Risk Finance 25 (2024) 510–536.
date_created: 2025-12-09T14:42:44Z
date_updated: 2025-12-09T14:48:50Z
department:
- _id: '19'
doi: 10.1108/jrf-03-2023-0075
intvolume: '        25'
issue: '3'
language:
- iso: eng
page: 510-536
publication: The Journal of Risk Finance
publication_identifier:
  issn:
  - 1526-5943
publication_status: published
publisher: Emerald
status: public
title: The impact of market concentration and market power on banking stability –
  evidence from Europe
type: journal_article
user_id: '50109'
volume: 25
year: '2024'
...