Motives and effects of transforming foreign banks into branches

As part of the planned research project, we want to analyze the activities of bank branches and subsidiaries operating on foreign markets and belonging to international banking groups in two basic aspects. First, we intend to determine what factors influence the decisions of international banks to transform their subsidiaries (banks) in foreign markets into branches. Secondly, we plan to check the financial consequences of the decision to transform a subsidiary bank into a branch for the parent entity. To achieve the research goals, we intend to use the financial statements of international banks and their subsidiaries, which will come from the Bankscope database. The database includes both reports of subsidiaries that were later transformed into branches, as well as of their parent entities. In order to determine the current forms of activity of banks and their changes, information available in the press, from national supervisory authorities and the Internet will be used. The basic research tool will be the estimation of linear and non-linear panel models, with the most important explanatory variables in all models being those illustrating the activities of subsidiaries and their parent entities.