Concentration on the Banking System in North Macedonia
Concentration on the Banking System in North Macedonia

Summary/Abstract: Business environment, competition, globalization and technology developments are the dominating factors that lead the banking system to drive the changes. In the period under analysis, the Macedonian banking sector was in a developing and evolutionary cycle, particularly after the 2008 crisis, by exhibiting and manifesting several changes over the last years. The present study examines the evaluation of the banking system concentration from 2015 until 2018. The study pyovides arguments to this approach by applying the Herfindahl-Hirschman Index and the concentration ratio of the CR3 and CR5 indicators by estimating and examining the concentration level on five variables or five largest banks operating in the Republic of North Macedonia. The study shows that increased levels of concentration are consistent with the increased operations of the banks. The banking system resulted highly concentrated on assets and indicated moderate level of concentration on loans and deposits, where the leading banks or institutions are dominating the banking industry.

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