Cost efficiency and profitability in leasing and factoring. The Italian case

The paper analyzes this capability by focusing on the profitability and cost efficiency profiles of firms operating in some banking related sectors. Despite the wide variety of these sectors, the authors confine the research to leasing and factoring.Regression analysis is applied to accounting data of leasing and factoring firms in order to identify those elements which may explain the significant dispersion of corporate performance evident in both sectors. Special attention is devoted to the role played by firm size and ownership structure. Their relevance stems from the structural profiles of the two sectors. With regard to the firm size, the interest in verifying its relationship with corporate performance has been recently stimulated by some mergers and acquisitions which could be the first symptoms of a concentration process, bound to change a supply structure, that in both sectors appears fragmented. Regarding the ownership structure, it must be mentioned that both within the leasing market, and within the factoring market banks' affiliates face lessors and factors linked to industrial and financial groups. Section 2 of the paper outlines the market development, the size and the structural profile of leasing and factoring, underlying, where possible, differences with other countries. In section 3 samples, variables and data adopted in the empirical analysis are described. Sections 4 and 5 depict the econometric methodology and the results. Concluding remarks are in section 6.