This is the first study to simultaneously estimate the influence of market power and efficiency on profitability of banks in a Pacific Island context. Two market power hypotheses — the Structure-Conduct-Performance (SCP) and the Relative-Market-Power (RMP) hypotheses together with two measures...

Banks in the small island developing states of the Pacific have not only survived the Global Financial Crisis but remain strong and profitable raising the question: what determines the strong profitability of banks in the PICs? Moreover, despite the large and extended literature on the subject,...