Ownership Structure and Corporate Performance of Multinational Banks: Evidence from Nigeria (original) (raw)
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This study investigated the effect of ownership concentration on the performance of the Nigerian banking sector for the period of 2008 to 2014.The study employed a sample of 5 major commercial banks in Nigeria selected on the bases of size. The data for the study was generated from the annual report of each of the banks under study for the period covered. We employed pooled panel data regression analysis to empirically evaluate the data. Both accounting and market based performance were employed with ROA and ROE as the key variable to proxy accounting based performance while EVA were used for market based performance. The result of the pooled panel data analysis reveals that ownership concentration has positive but insignificant effect on both the accounting and market based performance measures employed in the model. On the same vain, firm size which was used as a control variable has a positive and significant effect on both accounting and market based measure of banks performance. We therefor recommend that as concentrated owners seek to increase their interest, appropriate legal and control measures should be put in place to ensure that major owners don't control the banks to their own advantage and to the expense of minority shareholders and the public at large.
Journal of Emerging Economies and Islamic Research, 2019
This study seeks to establish a non-linear relationship between ownership concentration and financial performance of the listed Deposit Money Banks (DMBs) in Nigeria. The data were extracted from the annual reports and accounts of six (6) sampled DMBs from 2003 to 2014. A panel data regression technique was used to analyse the data collected. The study establishes that the relationship between ownership concentration and the financial performance of listed DMBs in Nigeria changes from negative to positive when the ownership concentration reaches 54.94%. This signifies that the relationship between ownership concentration and financial performance is negative if the concentration is below 54.94%. On the other hand, the relationship is positive if it is concentrated above 54.94%. Hence, it is recommended that the ownership of DMBs should not be concentrated below the cut-off point (54.94%) with the view to earning profits.
Abstract This study examines the relationship between ownership structure and the financial performance of listed firms in the financial sector of the Nigerian economy. To achieve the objective of this study, a total of 31 selected listed firms in the Nigerian stock exchange market were used. Also, the corporate annual reports for the period 2006-2010 were analyzed. This paper basically modeled the corporate ownership structure and firm performance relationship of the selected listed firms using the multivariate multiple regression analysis method to test the research propositions in this study. The study as part of it findings observed that observed that institutional ownership has a significant positive impact on the performance of the selected listed firms in Nigeria. In addition, the study also revealed that that there is a significant positive relationship between foreign ownership and the firm performance in Nigeria. Keywords: Board ownership, Financial performance, Foreign Ownership, Institutional ownership, Financial sector
Ownership structures and firm performance in Nigeria: A canonical correlation analysis
Journal of Research in Emerging Markets, 2020
This study examined the relationship between ownership structure and performance of listed non-financial firms in Nigeria. Secondary data on managerial ownership, ownership concentration, foreign ownership, institutional ownership, Tobin q, return on assets, return on equities, and earnings per shares were collected from forty (40) sampled firms. The data were analyzed using canonical correlation and the findings showed that managerial and foreign ownerships are the dominant ownership structures while Tobin q, EPS, and ROA are the dominant performance measures. The study also found that ownership concentration, foreign ownership, and institutional ownership are positively correlated with firm performance, while managerial ownership is negatively correlated with firm performance. The study recommended that listed non-financial firms should encourage foreign investments in their firms and rewards performing managers with shares in the firm.
International Journal of Economics and Business, 2019
The ownership structure is defined by distribution of equity with regard to votes and capital as well as the identity of equity owners. This study examined the impact of ownership structure on the financial performance of listed deposit money banks in Nigeria. Employed ordinary least squares (OLS) multiple regression technique of data analysis. The study found that Executive directors, Non-executive directors and institutional ownership have significant impact on ROA and ROE of listed deposit money banks during the period of the study. Moreover, the findings revealed that Executive directors and institutional ownership of listed deposit money banks has a significant negative impact on both ROA and ROE. Lastly, the study found that Non-executive directors’ ownership of listed deposit money banks has a significant positive impact on ROA and ROE. The study recommends that regulators of deposit money banks in Nigeria should make policies that will encourage executive and Non-executive directors’ ownership in the Nigerian banking sector. The study also recommends that the institutional investors should also be encouraged.
Corporate Governance, Ownership Structure and Firm Performance in Nigeria
Research Journal of Finance and Accounting, 2013
This paper examines the relationship between two patterns of their impact on firm performance in Nigeria. concentrated and foreign ownership structures result in systematic variations in performance among Nigerian firms. The sample comprises a panel of 72 non period 2003 to 2007. The combination of 72 firms for a five which can be analyzed using panel data metho and earnings per share. The postulated hypotheses were tested, using the Ordinary Least Squares (OLS) method of data analysis. The empirical results suggest that concentrated ownership ha performance. The results do not, therefore, lend credence to government's unremitting emphasis on ownership concentration as a governance mechanism that can address the dismal performance of the state (SOEs). The results however, show that foreign ownership has significant positive impact on firm performance. The findings resonate with policy initiatives that promote foreign ownership investments.
OWNERSHIP STRUCTURE AND PERFORMANCE OF LISTED BANKS IN GHANA
The main purpose of this study involves investigating whether or not any empirical relationship prevails amongst ownership forms and banks’ financial outcomes. Utilizing archival data from 8 listed banks from 2014 to 2018, this study implemented a panel regression method of random effect with the aid of Hausman test to facilitate answering the research questions. The study finds that managerial ownership engenders significant parallel associationship with performance measured with profit before interest and taxation and return on shareholders’ funds. Second, the study learns that banks owned partially by the government and foreign investors suffer substantially from achieving performance with respect to profit before interest and taxation, and return on assets. Lastly, the study makes it known that banks owned by institutions can perform creditably well but the findings lack strong statistical backing. The study recommends that owners of banking institutions should practice a managerial system of ownership, linking compensation to performance, through offering incentive contracts in the form of profit sharing, stock options and performance bonuses. Banks owned by government, institutions and foreign investors are advised to strengthen and implement robust auditing and corporate governance systems so that managerial actions can be supervised and monitored effectively.
Ownership structure and the financial performance of listed conglomerate firms in Nigeria
This study assesses the impact of ownership structure on the financial performance, using listed conglomerate firms in Nigeria. The main objective of the study is to ascertain the level to which ownership structures influences the performance of Nigerian conglomerates firms. The methodology employed is the use of secondary data and the ex-post facto research design. The population of the study is all the conglomerates firms listed on the Nigerian Stock Exchange as at 31 st December, 2013. The study used regression as a tool of analysis. Findings show that managerial and foreign ownership has negatively impacted the performance of listed conglomerate firms within the sturdy period, while firm size positively impacted the firm performance. The study recommends among others that managerial ownership should not control up to 50% or more of shares allotted in the company which helps in reducing their control over other shareholders which may be responsible for poor performance, less room should be given to the foreign investors to own shares which though would help in monitoring the activities of the firm, expropriation of the firms wealth to foreign economy may be experience. Introduction This study provides additional evidence regarding the way in which ownership structure influences quoted Conglomerate Company's performance in Nigeria focusing on the conflict emanating on incentives due to managerial and foreign ownership participation on corporate Governance structure and their impact on the firm's performance. There is a general perception that ownership concentration in a company may actually improve its performance as having a large controlling shareholder (with majority voting) would ultimately decrease the company's monitoring costs. There is also an assumption that managers are imperfect agents of shareholders, as they could attempt to pursue their own goals rather than work on optimizing the shareholders' wealth. This is the reason why many families tend to entrust their business operations to family members who are also co-owners. Performance is crucial to any business organisation survival and continues patronage by investors, potential investors, potential investors, creditors, and other stakeholders in the business world. Every business organisation has an important decision of making returns. This decision is important since the ability of a firm to make returns in this competitive environment determines to a larger extend its ability to survive in the future. On the other hand, ownership structure of any company has been a serious agenda for corporate governance and that of firm's performance. The influences on the firm value by managerial ownership and foreign ownership have been issues that researchers have undertaken to investigate for decades. This has been widely tackled in developed climes and more recently in emerging markets, but was less discussed before in Nigeria in recent changing environment.
Ownership structure and firm performance: Evidence from Nigerian listed companies
Corporate Ownership and Control, 2011
This paper examines the relationship between firms' ownership structure and financial performance in Nigeria, using a sample of thirty listed companies between 2001 and 2008. Using pooled OLS as a method of estimation and after controlling for four firm-specific characteristics, our results show a negative and significant relationship between ownership structure (director shareholding) and firm financial performance (ROE). This is in support of Entrenchment hypothesis. Also, our study does not support a non-linear relationship between ownership structure and firm performance.
International Journal of Economics & Business, 2019
Abstract: The ownership structure is defined by distribution of equity with regard to votes and capital as well as the identity of equity owners. This study examined the impact of ownership structure on the financial performance of listed deposit money banks in Nigeria. Employed ordinary least squares (OLS) multiple regression technique of data analysis. The study found that Executive directors, Non-executive directors and institutional ownership have significant impact on ROA and ROE of listed deposit money banks during the period of the study. Moreover, the findings revealed that Executive directors and institutional ownership of listed deposit money banks has a significant negative impact on both ROA and ROE. Lastly, the study found that Non-executive directors’ ownership of listed deposit money banks has a significant positive impact on ROA and ROE. The study recommends that regulators of deposit money banks in Nigeria should make policies that will encourage executive and Non-executive directors’ ownership in the Nigerian banking sector. The study also recommends that the institutional investors should also be encouraged.