Reasons for bank privatization in the European Union Evidence from the EU-25 member states

The scope of our research is to delve into the topic of bank privatization and disclose possible reasons for it among the EU-25 member states. More specifically, we are researching elements that can have an effect on a government's decision-making process towards bank privatization. The development of the theoretical framework revealed three factors that could affect the triggering of the privatization process. Those factors are i) the economic, ii) the political and iii) the external factor. Respectively, they are being tested in the thesis as i) the size of the central government debt, ii) the preference of right-wing governments as compared to the rest for privatization and iii) the influence of the multilateral organizations. As far as factor (i) is concerned the findings of the research are the following ones. The size of the central government debt seems to hold a significant role in triggering the bank privatization process. In regard of factor (ii) we conclude that generally, the political color of the government does not affect the occurrence of bank privatization in the European Union and that this factor does not hold particular power in our research. As far as factor (iii) is concerned, we conclude that the influence of the multilateral organizations did not play any intrinsic role in the occurrence of bank privatization in the European Union.