Norges Bank

Staff Memo

Competitiveness and regulation of Norwegian banks

Karen Helene Ulltveit-Moe, Bent Vale, Morten H. Grindaker and Erling Skancke
Staff Memo

This report looks at the competitiveness of the Norwegian banking sector, in particular with respect to banking regulation and taxation. How do Norwegian banks perform relative to other European banks and relative to other firms in Norway? Do Norwegian banks have a competitive handicap compared with banks from neighbouring European countries, due to stricter regulation in Norway? And if so, what is the cost of this to the Norwegian economy?

This review shows that Norwegian banks have performed well. Furthermore, it concludes that Norwegian banks are, if anything, undertaxed as compared to non-financial firms in Norway and banks in other European countries. On the other hand, Norwegian banks are subject to somewhat stricter regulations than other Nordic banks. However, due to differing macroeconomic conditions and forbearance regimes, as well as barriers to free competition, in the short run the benefits of stricter regulations probably outweigh the costs.


Staff Memos present reports and documentation written by staff members and affiliates of Norges Bank, the central bank of Norway. Views and conclusions expressed in Staff Memos should not be taken to represent the views of Norges Bank.

ISSN 1504-2596 (online)

Published 5 December 2013 15:35
Published 5 December 2013 15:35