*8.2. Answer*

It is clear that the criticism has been based on the incorrect hypothesis that the underlying dataset of our Equation (14) contains raw data (i.e., a Lerner index for each bank).

Actually, the underlying dataset of our Equation (14) contains weighted data (in terms of total assets), which have been aggregated at the country level. The index *i* in Figure 4 explicitly refers to countries, not to individual banks.

$$
\ln \left( \frac{\mathbb{C}\_{\text{ft}}}{\mathbb{C}\_{\text{ft}-1}} \right) = \alpha + \beta \ln \mathbb{C}\_{\text{if}-1} + \sum \text{Count} \, y\_{\text{i}} + \varepsilon\_{\text{il}} \tag{14}
$$

**Figure 4.** The β-convergence test with respect to competition.

Besides, it is clear that Section 7 in our research investigates the existence of β-convergence (with respect to competition) of countries belonging to three euro area country groups (all 19 countries, core countries, and periphery countries, respectively). There is nowhere any reference to convergence of individual banks with respect to competition.

Based on the above, we consider that the criticism on our convergence analysis is not relevant.

**Funding:** Financial assistance from the Research Centre of the Athens University of Economics and Business. **Conflicts of Interest:** The authors declare no conflict of interest.
