The Effect of Ownership Structure on Financial Stability: An Empirical Investigation
Universidad Carlos III de Madrid - Department of Business Administration
Autonomous University of Barcelona - Faculty of Economics and Business Studies
October 28, 2009
This paper analyzes the stability of financial systems with different bank’s ownership structures. We distinguish between profit oriented banks (commercial banks) and non-profit maximizing bank such as savings banks and cooperative banks (stakeholder banks). Using a country-level panel dataset over the period 1993-2007, and two different measures of financial stability at the systemic level (the country portfolio Z-score and a crisis dummy variable), we find consistent evidence that the presence of stakeholder banks in the financial sector increases systemic financial stability.
Number of Pages in PDF File: 32
Keywords: Ownership structure, Risk-taking, Financial stability, Stakeholders, Concentration
JEL Classification: G21, G32, G18, G38.
Date posted: October 29, 2009 ; Last revised: August 24, 2012