This thesis consists of essays on the financial performance of the Commonwealth of Independent States’ (CIS) banking systems. Chapter 2 presents a historical overview of the financial sectors development in transition countries and the CISs in particular. It shed light on key issues of the massive changes in the financial systems of the former soviet bloc countries and their influence on the countries’ banking system landscape nowadays. This chapter aims to contribute to the better understanding of the transition processes from momobank system to two-tier banking system in the CIS countries by providing theoretical background and empirical evidence of transition processes. After more than 20 years of transition the financial systems in the CIS countries have features to different extents, which are the legacy of the former system of finance. Nevertheless, overall the banks in the CISs were transferred into commercial banks and adopted the concept of conventional banking though to different degrees across countries. One of the most important transformations in the CIS banking sectors is the ownership of banks, which were fully state-owned during the soviet times; and privatisation and liberalisation completely reshaped the ownership structure in the CISs. Moreover, the changes in regulation and supervision have critically transformed banks’ risk-taking behaviour, which is also one of the major concerns of our study. Chapter 3 examines bank performance in terms of technical efficiency with particular attention to the impact of bank ownership and risk-taking behaviour and addressing environmental effects on banks technical efficiency in the CISs. Our findings provide empirical evidence that ownership structure matters for the CIS banks efficiency. Using state-owned banks as a benchmark we found that while private banks are less technically efficient than state-owned banks in the CIS countries as well as banks with foreign majority ownership, the CIS-owned banks are more efficient than other banks in the region. Risks-taking behaviour has different impact on performance in the CIS countries. This research has found positive association between capital, credit and market risk and performance, while negative association between liquidity risks and bank performance in the CISs. Chapter 4 examines cost and profit efficiency incorporating important variables, which are considered critical for differences in efficiency, as in Chapter 3. We include ownership type, risk-taking behaviour and different environmental factors to estimate reliable cost and profit efficiency measures. Different concepts of efficiency introduced in this study extend our analysis of bank efficiency, and offer a comprehensive study of the CIS banks performance. We found that privately owned banks are less cost efficient than state-owned banks. Although foreign banks are more profitable than state-owned banks, they are as cost efficient as state-owned banks. The CIS-owned foreign banks are less cost efficient than other banks in the CIS countries. There are different impacts of risk-taking behaviour on bank cost and profit efficiency in the CIS countries. Banks with lower capital risk are more cost efficient. Higher credit risk taking is associated with lower profitability of banks. While banks with lower liquidity risk are more profit efficient, they are less cost efficient. Higher market risk is associated with less cost efficiency. Finally, there is a convergence in cost and profit efficiency scores of banks across the CIS countries indicating a process of re-integration among CIS financial systems. Chapter 5 explores the impact of competition on the stability of banks in the CIS countries. We found that competition is good for stability and verified the competition-stability nexus for the CIS countries. This study also concluded that the improvement of legal rights of borrowers and lenders and bank supervision in the CISs would contribute to banking system stability. Our concluding policy recommendation is that policymakers need to design regulations that would ensure stability and market discipline without impeding competition and efficiency of banks in the CISs.