Concentration ratio

Measure of the market share of the largest banks in a country. The main benchmarks are – the balance sheet total, – the total of lending, – the total of deposits, and sometimes also – the number of accounts kept (managed) and – the number of local branches. – Each of these indicators, as well as further criteria, raises many questions. Therefore, it is always advisable to compare several characteristics in order to calculate the concentration ratio. – See bank size, optimal, banking supervision, European, three-pillar model, Gigabank. – Cf. formulas and calculation for Germany in the Deutsche Bundesbank’s Monthly Report of September 2001, p. 61.

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