Ownership concentration and bank profitability

By Peterson K. Ozili, O. Uadiale. 2017

116 citations recorded by the source corpus.

We investigate whether ownership concentration influences bank profitability in a developing country context. We focus on bank ownership concentration measured as the amount of direct equity held by a majority shareholder categorised into: high ownership concentration, moderate ownership concentration and disperse ownership. We find that banks with high ownership concentration have higher return on assets, higher net interest margin and higher recurring earning power while banks with dispersed ownership have lower return on assets but have higher return on equity. Also, higher cost efficiency improves the return on assets of widely-held banks and the return on equity of banks with moderate ownership. The findings have implications.

Subfields: Accounting, Finance

View Paper: https://www.semanticscholar.org/paper/39012dc761ba8f9bba4ec4d2df42b1d9906e80b2

Citations in the corpus

• Banking stability determinants in Africa (2018, unknown): “Higher noninterest income implies greater banking sector stability because banks do not have to rely solely on interest income which is considered to be unstable due to competition among banks for depositors’ money (Smith et al, 2003; Williams, 2016; Ozili 2017a).”