I agree with Professor Allen: although state banks can become vehicles for government policies and tend to be less efficient and competitive, developing and transitioning economies benefit from the stability and political security offered by state ownership as countries evolve from demand to market economy.Since the 1980s the mantra has been privatization, deregulation, acquisition and expansion, but as proven in 2008 this model has had very mixed results. France has had the most successful evolution from nationalization in the early 1980s to privatization of the top three banks through the 1990s, but the state maintains influence and the model of universal banking and expansion into global markets remained the same under state or private ownership. In Germany the Landesbanken were perfectly efficient and focused on regional client base as long as they were under state subsidies.Once the subsidies were removed under EU pressure, these banks tried to be become competitive and innovative , failing dismally and are now in process of being absorbed and consolidated.Former CEE countries without any experience or legal framework for bank privatization wanting to quickly emulate Western banks in 1991-1998, were unable to achieve credibility or viable ratings.By 2000 , 65-80% of the sector was taken over major foreign EU banks. Israel began to privatize banks in 1986 and reached full privatization by 2000, with the government retaining minority shares. Joint public private ownership for emerging economies (Brazil , India) is often a sounder political and social model as it guarantees additional stability and credibility.