Bank interest margins in OECD countries

Kim Hawtrey*, Hanyu Liang

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

84 Citations (Scopus)


This paper extends the literature on bank interest margins by providing empirical evidence using panel data covering the banking sector of fourteen OECD countries. Each country's banking sector is treated as a single representative firm viewed as a national risk-averse dealer setting loan and deposit rates to balance the random arrivals of loan requests and deposit supplies. We find that national industry margins are influenced by market power, operational cost, risk aversion, interest rate volatility, credit risk, volume of loans, implicit interest payments and quality of management.

Original languageEnglish
Pages (from-to)249-260
Number of pages12
JournalThe North American Journal of Economics and Finance: a journal of financial economics studies
Issue number3
Publication statusPublished - Dec 2008


  • Bank
  • Interest margin


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