The surveys were conducted by the local offices of the international finance corporation. This paper provides an empirical investigation on the way in which ownership structure influences bank performance. The relationship between ownership structure and bank performance in malaysia and found that government ownership had a large influence on changes in. Ownership structure and bank performance in eu15 countries. Research results show that capital concentration and private ownership have. Causality of relationship runs from ownership structure to financial performance. Ownership concentration and bank profitability sciencedirect. The paper examines the effect of ownership and governance on firm performance. Ownership structure and bank performance semantic scholar. Concentrated ownership structure is viewed as reducing the agency problem between shareholders and managers resulting from the separation between ownership and control. Those who own majority of stock disposed to conduct more monitoring in management and influence the managers to improve the performance of company. Jun 10, 2014 this study aims to investigate empirically the relationship between ownership structure concentration and mix and islamic bank performance, with a special attention to the identity of the block investor foreign, family, institutional and state.
The ownership structure affects the risk of bank management tsorhe et al, 2010. This paper makes a strong contribution to business literature by investigating the effects of organizational form and ownership structure on firm performance. The study further adopted the positivism philosophy which guided the research. These are studies carried out in the developed economy. Specifically, it examines to what extent shareholder type and the degree of shareholder concentration affect the banks profitability, risk and technical efficiency. Pdf on mar 1, 2018, n rahisam and others published ownership structure and islamic bank performance find, read and cite all the research you need on researchgate.
Ownership structure, inside ownership and firm performance. Ownership identities are able to influence the governance issuesasymmetric information, agency conflicts and risk. Ownership structure and bank performance journal of economics. Studies into capital structureand performance have ignored. Most of the available studies on the ownership performance. Impact of ownership structure on financial performance of. This study examined the impact of ownership structure on the financial performance of listed deposit money banks in nigeria. The study was primarily grounded on the camel model and theory of the firm. The impact of ownership concentration and the type of ownership on bank performance have been analyzed using four different. Pdf ownership structure and bank performance researchgate. Hence the current research sought to determine the effect of ownership structure, bank stability and the financial performance of commercial banks in south sudan.
Ownership structure, bank stability and the financial. Impact of ownership structure and bank performance an empirical test in. Most of the available studies on the ownershipperformance. The findings show that the effect of macroeconomic variables was inconclusive. Specifically, this study has examined the static effect of ownership structure on bank performance in indonesia over the period 19952006. This chapter starts with explanations on corporate governance and ownership structure and followed by explanations about the relation between banks ownership structure and performance on section 1. Abstract this paper examines the impact of ownership structure on the financial performance of listed insurance firms in nigeria. In nigeria, reports by ndic 1991 showed that ownership structure and types of bank are.
Corporate governance, ownership and bank performance in. According to nora azureen 2015, bank ownership structure is divided into five types of ownership which is insider, family, government. This finding is consistent with the view that diffuse ownership, while it may exacerbate some agency problems, also yields compensating advantages that generally offset such problems. This study examined ownership structure of commercial banks in kenya and also established whether a relationship exists between ownership structure and bank financial performance. Moreover, ownership type diversity is positively associated with bank performance, and banks with concentrated ownership are worse performing. Econometric examination of ownership structure and financial performance indicators of money deposit bank case study of several banks in nigeria. Corporate governance and bank performance that would confirm the theoretical background on this issue. They used panel data with 7900 observations banks over the period. Thompson 1997 both found that ownership structure affects bank performance. The study uses panel data for seventeen 17 firms for the period 2001 2010 10 years. Ownership structure and bank financial performance in kenya. According to nora azureen 2015, bank ownership structure is divided into five types of ownership which is insider, family, government, institution and foreign ownership. Ownership structure and corporate performance by harold. The purpose of this paper is to investigate the impact of ownership structure on bank performance in eu15 countries.
Journal of economics, business and management, vol. Econometric examination of ownership structure and financial. This study aims to investigate empirically the relationship between ownership structure concentration and mix and islamic bank performance, with a special attention to the identity of the block investor foreign, family, institutional and state. Jun 04, 2018 the purpose of this paper is to investigate the impact of ownership structure on bank performance in eu15 countries. This study shall also address the endogeneity problem if it exists. This article investigates the roles of state and private ownership and foreign and domestic ownership on the performance of banks across latin america.
Firms performance has been measured through return on asset roa and return on equity roe. Pdf ownership structure and islamic bank performance. The impact of ownership structure on the financial. The study has shown that ownership concentration has a positive and significant effect of bank performance profitability while foreign ownership positively affects the bank performance. To study the correlation between ownership and performance, we use banklevel data and standard indicators of bank profitability and efficiency such as return on assets roa, interest margins, overhead costs, and employment to estimate the following equation. I focus on the role of two main dimensions of the ownership. Consequently, for data that reflect marketmediated ownership structures, no systematic relation between ownership structure and firm performance is to be expected. On the contrary, demestz and lehn 1985 found no effect of ownership structure on bank performance. This study conducted to investigate the relationship between ownership structures on bank performance in malaysia consists local islamic banks and foreign islamic banks. The ownership structure that emerges, whether concentrated or diffuse, ought to be influenced by the profitmaximizing interests of shareholders, so that, as a result, there should be no systematic relation between variations in ownership structure and variations in firm performance.
By highlighting the corporate governance components that normally used in the academic research, this study tends to identify the important components that applied in the reforms of the malaysian corporate governance. By analyzing capital structure and bank performance, there is the possibility of endogeneity problem between capital structure and bank performance. My findings are robustness under the different measures of bank performance. Effect of ownership structure and corporate governance to. Corporate governance, ownership structure and bank performance in jordan article pdf available may 2014 with 1,650 reads how we measure reads. Findings indicate that there is a positive significant relationship between. Impact of ownership structure on financial performance of banks. They used panel data with 7900 observations banks over the period 19881995. Corporate governance, ownership structure and bank performance in jordan. Changes in ownership structure without a supporting regulatory and supervisory body in place is likely to lead to a banking crisis boubakri, et al. Ownership structure and bank performance munich personal. Pdf corporate governance, ownership structure and bank. The risk faced by sharia banking is also affected by the banks diverse structure of banks.
The paper traces the ownership details of 249 banks in 20 middle eastern and north african countries mena, with a total of 567 observations during the sample years of 20002002. However, bank status has no effect on bank performance. The relationship between ownership structure and bank performance in malaysia and found that government ownership had a large influence on changes in bank performance 6. By tracing the identity of top owners, i group large shareholder of chinas commercial banks into government, state owned enterprises soes, domestic private investors and foreign investors.
An analysis of cooperative and mutual savings banks daniel c. Pdf impact of ownership structure on bank performance. Ownership structure, corporate governance, and corporate performance. This study investigates whether ownership type does matter for bank performance in an emerging market.
Impact of ownership structure and bank performance an. These economists tried to develop a theory of the ownership structure of the firm by integrating elements from the theory of. Pdf ownership structure, corporate governance and firm. Ownership structure dominance, risk taking and bank. The sample consists of 74 banks, namely 56 private banks, 15 community development banks bpd, and three federal banks from 1995 to 2006. Data from the central bank of kenya shows a significant growth in the. Evidence from panel data of south korea sanghoon lee university of utah, department of economics abstract the study seeks to examine the effect of equity ownership structure on firm financial performance in south korea. The arthur levitt public affairs center hamilton college august 27th, 2009 1 special thanks to professor derek jones, without whose guidance this paper would not have been possible. This study recommends that the government should adopt better measures to safeguard publicowned commercial banks to improve their efficiency and performance. There are a lot o papers analyzing bank efficiency, stability, accounting performance and ownership structure, but a few that examine the relationship between. Then, it is also of interest to understand how banks performance is related with ownership structure, legal investor protection and bank regulations. The relation between ownership structure and performance has been the subject of continuous debate since the original paper of 1. Although bank ownership structure and its impact on performance is an important concern, only a handful of research initiatives have specifically focused on mena countries and most.
The second element for evaluating banks efficiency is its performance. Tracing the post financial crisis experience, 19982002, of the korean commercial bank industry, the paper investigates whether the involvement of foreign investors in the ownership structure had any significant effect on the banks performance i. Bank financial performance in the recent past has significantly improved since 2000. However, empirical results have failed to provide consistent evidence to prove whether the type of ownership does significant affect firm performance. The authors investigate whether ownership structure significantly affects the performance of publicly listed firms in china and if so, in what way. This chapter provides a brief discussion on the relationship between ownership structure and bank performance. There are several aspects and dimensions of corporate governance, which may influence a firms. The risk faced by sharia banking is also affected by the bank s diverse structure of banks. There are a lot o papers analyzing bank efficiency, stability, accounting performance and ownership structure, but a few that examine the relationship between bank performance and corporate governance. According to li and simerly 1998, the ownership structure of bank affect the level of oversight of effort manager in order to improve banks performance. Ownership structure and corporate performance sciencedirect.
Although studies addressing the issue of ownership structure and bank performance have increased rapidly in the. Econometric examination of ownership structure and. Ownership structure is considered an important factor that affects a firms health. This situation frames a picture that ownership structure is a vital determinant in enhancing firm performance. Ownership structure, corporate governance, and corporate. Yet again, a financial crisis offers a unique opportunity to study the assumed to be wellknown relationship in a different, irregular environment. Ownership structure and corporate performance ying li previous studies of ownership structure mainly focus on the relationship between insider ownership and corporate performance. Performance evaluation is an important prerequisite for sustained growth and development of. This paper explores the link between ownership, corporate governance and bank performance using proprietary bank surveys of 50 banks in ukraine surveyed in 2004, and 107 banks in russia 50 surveyed in 2003 and 81 in 2006. Although bank ownership structure and its impact on performance is an important concern, only a handful of research initiatives have specifically focused on mena countries, namely turkey isik and hassan, 2003.
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