Ownership concentration, ownership identity, and bank performance

  • 677 Views
  • 89 Downloads

Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License

This paper examines whether ownership concentration and certain type of ownership can affect the financial performance of Lebanese banks. It uses longitudinal data from the largest 35 Lebanese banks over the period 2009–2014 and employs the panel regression model. The empirical results show that ownership concentration and certain type of shareholders play an important role in the area of corporate governance in Lebanese banks. In particular, bank financial performance is positively associated with ownership concentration, managerial ownership, and foreign and institutional ownerships; however, family ownership is not related to bank performance. Also, this paper shows that both ownership concentration and managerial ownership have a U-shaped relationship with bank performance. Several robustness tests largely confirm the findings, with important implications for policy-makers. The findings are crucial to policy-makers and bankers who are interested in tailoring good corporate governance principles for the Lebanese banking sector.

view full abstract hide full abstract
    • Table 1. Summary of dependent/independent/control variables and their measurements
    • Table 2. Correlation matrix
    • Table 3. Regression results of firm performance (ROA)
    • Table 4. Results of reversal causality