Performances of Italian Banking System: The Digitalization Effect in Different Business Models
This article analyses the effects of digitalization on the performance of the Italian banks considering the business models. The dataset is composed of commercial, cooperative and saving banks for the period running from 2011 to 2016. The methodology used is those of the instrumental variables. The results show the significance of the variables such as logarithm of operating expenses and the percentage of persons who use internet banking for both commercial and cooperative banks. For cooperative banks, the Tier 1 ratio is also statistically significant, with a negative relationship. The business model of saving banks is not statistically significant. The aspect that should be emphasized is the negative relationship between Net Interest Income and internet banking for commercial banks and instead positive for cooperative banks. This has a double meaning: the Italian customer still uses internet banking almost and exclusively for simple daily operations and prefers to go to the branch for more complex operations; cooperative banks adopt strategies and policies so different from commercial ones that internet banking has a positive effect.
Keywords- Digitalization, Internet banking, Business model, Performance, Bank, Italy.