Finding Balance 2019: Benchmarking the Performance of State-Owned Banks in the Pacific

Finding Balance 2019 profiles the roles, performance, market context, and regulatory framework of 13 state-owned banks in 10 Pacific island countries. This is the sixth in a series of state-owned enterprise benchmarking studies launched by the Asian Development Bank (ADB) in 2009, and the first to focus solely on the banking sector.   This studies have illustrated the inherent risks with government ownership of commercial businesses. Banks are no exception. Therefore, the case for any state-owned bank needs to be periodically reviewed and validated. Pacific policy makers agree with the international consensus that state-owned banks should only exist where they can demonstrate additionality, e.g., provide services in a commercial manner that would not otherwise be provided by private banks, or make the banking system more competitive. As the financing needs of businesses evolve in each country, so too must the financial service providers, including these state-owned banks.