The Effects of Changes in Ownership Structure on Performance: Evidence from the Thrift Industry

39 Pages Posted: 23 Apr 2007 Last revised: 10 Apr 2010

See all articles by Rebel A. Cole

Rebel A. Cole

Florida Atlantic University

Hamid Mehran

Independent

Date Written: January 12, 1998

Abstract

Restrictions on stock ownership may harm a company's performance because restrictions prevent owners from choosing an optimal structure. We examine the stock-price performance and ownership structure of a sample of thrift institutions that converted from mutual to stock ownership. We find that, after conversion and the expiration of ownership-structure restrictions, firm performance improves significantly, and the portions of the firm owned by managers and the firm's employee stock ownership plan increase. Changes in performance are positively associated with changes in ownership by managers, but negatively associated with changes in ownership by employee stock ownership plans.

Keywords: corporate control, regulation, ownership structure, anti-takeover provisions

JEL Classification: G21, G28, G32, G38

Suggested Citation

Cole, Rebel A. and Mehran, Hamid, The Effects of Changes in Ownership Structure on Performance: Evidence from the Thrift Industry (January 12, 1998). Journal of Financial Economics, Vol. 50, 1998. Available at SSRN: https://ssrn.com/abstract=981274

Rebel A. Cole (Contact Author)

Florida Atlantic University ( email )

College of Business
777 Glades Road
Boca Raton, FL 33431
United States
1-561-297-4969 (Phone)

HOME PAGE: http://rebelcole.com

Hamid Mehran

Independent ( email )

No Address Available

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