Impact of Banking Group's Management Policies and Country Environment on Bank's Model of Operation

The objective of this paper is to seek to identify which of two factors: (1) the banking group management policies, or (2) the country in which the bank operates, has higher impact on the bank’s model of operation measured in terms of three ratios: net fee and commission income compared to net interest income, impairment losses on loans compared to net interest income and net fee and commission income compared to personnel expenses. The analysis included 29 banks affiliated in four banking groups and nine CEE countries during the period 2014 and 2015. The results show that the country environment has much higher impact on banks’ operations than their management policies.