Bank Savings Competition in the Market and Factors in Mongolia

Abstract

Mongolia has a total of 13 commercial banks, which for 94.5% of the market

share of the financial market. In this market, banks are always competing to attract deposits or

raise funds. The study looked at how Mongolian commercial banks compete for funding, what

macro- and micro-environmental factors influence fundraising, and what terms of deposit

service customers use. In the case of Mongolia, the banking market is an oligopolistic market

participant, but the deposit market is a monopoly market participant. Macroeconomic factors

include the yuan's exchange rate, policy rate, money supply, gross domestic product, income,

and population, while inflation and the dollar exchange rate reduce savings. Among the microenvironmental factors, interest rates on time and demand deposits and the number of customers

increase the number of deposits, while owners' equity reduces the number of deposits.