Systems of Banking and Production in Argentina
Víctor Fernández, Carolina Lauxmann and Julio Tealdo
a) Levels of Concentration-Decentralization in the Financial Banking System ( ...continuation )

The evolution of the level of concentration observed in the financial system can also be seen by analyzing the participation of the 10 top banks over their total assets, 5 deposits and loans in December of every year. 6 The analysis of these variables, once again, reveals a panorama practically free of variation following the collapse of the convertibility regime. The most important private banks controlled 45.91% of the banking system’s total assets during the time period from 2002-2010, a percentage that has essentially been maintained since the end of the 1990s, when the average was 45.37%. Following the crisis, the top ten private banks continued to play a strategic role in financial intermediation, capturing 41.81% of deposits and granting 52.68% of the total loans of the banking system as a whole (Figure 2). Still, we should point out that there was a slight decrease in their participation in total deposits relative to the last five years of the 1990s, when they averaged 46.84%. This five-point drop can be attributed to the Flight to Quality of savings funds towards public banking following the 2001 crisis (Marshall, 2007).

Figure 2. Relative Average Participation of the Ten Most Important Banks Over Total Assets,
Loans and Deposits in the Financial Banking System (December of Every Year)
(1996-2001; 2002-2010)

Source: Prepared by the authors, based on information from the bcra, Financial Institutions Report.

5 The main asset areas for these financial institutions is composed by granted loans , followed by other financial intermediation assets, which include transfer transactions, bond and foreign currency operations, negotiable liabilities, options, etc. and public bonds.

6 The period analyzed is smaller here due to lack of availability of data provided by the Argentinean Central Bank of the Republic (Banco Central de la República Argentina, bcra).