The banking competition and efficiency in the transmission of monetary policy in CEECs

We study the role of the banking competition and of the banks' efficiency scores in the transmission of monetary policy in the 10 new European Union member-states. The banking competition is measured by H-statistics of Panzar and Rosse, and the efficiency scores are estimated by non-parametric technique. We find that more market power the banks have and more efficient their activities are, the lesser they respond to the monetary policy. Moreover, including also capitalisation and liquidity levels and banks' size, more capitalised, more liquid and larger the banks are, the lesser they react to the monetary policy.banking competition; bank efficiency; monetary policy; CEECs; Central and Eastern European Countries; CEE banks; emerging economies; bank capitalisation; liquidity levels; bank size.