{"status":"ok","message-type":"work","message-version":"1.0.0","message":{"indexed":{"date-parts":[[2025,10,11]],"date-time":"2025-10-11T00:38:33Z","timestamp":1760143113441,"version":"build-2065373602"},"reference-count":68,"publisher":"MDPI AG","issue":"1","license":[{"start":{"date-parts":[[2024,1,17]],"date-time":"2024-01-17T00:00:00Z","timestamp":1705449600000},"content-version":"vor","delay-in-days":0,"URL":"https:\/\/creativecommons.org\/licenses\/by\/4.0\/"}],"funder":[{"name":"National Funds","award":["UIDB\/05583\/2020","SE_P097"],"award-info":[{"award-number":["UIDB\/05583\/2020","SE_P097"]}]},{"name":"Research Center in Digital Services (CISeD)","award":["UIDB\/05583\/2020","SE_P097"],"award-info":[{"award-number":["UIDB\/05583\/2020","SE_P097"]}]},{"name":"Instituto Polit\u00e9cnico de Viseu","award":["UIDB\/05583\/2020","SE_P097"],"award-info":[{"award-number":["UIDB\/05583\/2020","SE_P097"]}]},{"name":"Banco de Portugal Microdata Research Laboratory\u2014BPLIM","award":["UIDB\/05583\/2020","SE_P097"],"award-info":[{"award-number":["UIDB\/05583\/2020","SE_P097"]}]}],"content-domain":{"domain":[],"crossmark-restriction":false},"short-container-title":["IJFS"],"abstract":"<jats:p>In this study, we provide a thorough analysis, conducted on a company-by-company basis, of the impact of bank concentration and the bank-relative power of banks on firm profitability, financing costs, and capital structure in a small economy like Portugal. Using a sample of 434,990 Portuguese companies, the study spans a time frame of 13 years (from 2006 to 2018). Principal component analysis (PCA) was used to determine bank concentration, and a new variable, \u201cbank-related power\u201d, was introduced. This work employed linear regression with static panel data for fixed and pooled effects, using Driscoll\u2013Kraay standard errors and robust standard error estimation. A direct association was found between business performance and the use of bank credit in highly concentrated banking markets (SMEs), and there is evidence of an inverse relationship when the relative power of banks increases (small business). Evidence also shows that financing costs increase with greater bank concentration, while firms\u2019 capital structure improves under similar conditions. When a bank holds greater relative market power, it tends to exert a negative impact on the capital structure of large companies. However, an inverse relationship is observed in the case of SMEs. Unlike previous studies, the article assesses the effects of bank market power on each of the different companies involved by using both bank concentration (as a composite variable) and a new variable that measures the relative power of banks. Due to its extensive database and expanded time frame, this research is innovative in the context of small-sized companies.<\/jats:p>","DOI":"10.3390\/ijfs12010007","type":"journal-article","created":{"date-parts":[[2024,1,17]],"date-time":"2024-01-17T07:41:28Z","timestamp":1705477288000},"page":"7","update-policy":"https:\/\/doi.org\/10.3390\/mdpi_crossmark_policy","source":"Crossref","is-referenced-by-count":2,"title":["Bank Market Power, Firm Performance, Financing Costs and Capital Structure"],"prefix":"10.3390","volume":"12","author":[{"given":"Marisa Pessoa","family":"Gon\u00e7alves","sequence":"first","affiliation":[{"name":"Department of Management, Higher School of Technology and Management, Polytechnic Institute of Viseu, 3504-510 Viseu, Portugal"}]},{"given":"Pedro M. Nogueira","family":"Reis","sequence":"additional","affiliation":[{"name":"Department of Management, Higher School of Technology and Management, Polytechnic Institute of Viseu, 3504-510 Viseu, Portugal"},{"name":"CISeD\u2014Research Center in Digital Services, Polytechnic Institute of Viseu, 3504-510 Viseu, Portugal"}]},{"ORCID":"https:\/\/orcid.org\/0000-0002-9561-3509","authenticated-orcid":false,"given":"Ant\u00f3nio Pedro","family":"Pinto","sequence":"additional","affiliation":[{"name":"Department of Management, Higher School of Technology and Management, Polytechnic Institute of Viseu, 3504-510 Viseu, Portugal"},{"name":"CISeD\u2014Research Center in Digital Services, Polytechnic Institute of Viseu, 3504-510 Viseu, Portugal"}]}],"member":"1968","published-online":{"date-parts":[[2024,1,17]]},"reference":[{"key":"ref_1","doi-asserted-by":"crossref","first-page":"379","DOI":"10.1007\/s11846-019-00344-5","article-title":"Capital structure and firm performance: Evidence of Germany under IFRS adoption","volume":"15","author":"Abdullah","year":"2021","journal-title":"Review of Managerial Science"},{"key":"ref_2","doi-asserted-by":"crossref","first-page":"416","DOI":"10.1002\/ijfe.1796","article-title":"The determinants of performance in the Eurozone banking sector: Core versus periphery Eurozone economies","volume":"26","author":"Agoraki","year":"2021","journal-title":"International Journal of Finance & Economics"},{"key":"ref_3","doi-asserted-by":"crossref","first-page":"335","DOI":"10.1007\/s11187-008-9154-6","article-title":"Is banking competition beneficial to SMEs? 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