Dual Governance in State-Owned Banks

Rodolfo Apreda

No 319, CEMA Working Papers: Serie Documentos de Trabajo. from Universidad del CEMA

Abstract: State-owned enterprises set a clear example of a mixed governance, in which the public and private realms blend together to bring about a complex structure we are going to define as dual governance. This paper puts forth a new design of governance for state-owned banks. Firstly, the whole subject is framed within the transaction costs approach to financial intermediation. Next, we move on to the formal governance of state-owned banks. Afterwards, we focus on dual governance and expand on agency problems that arise from the fiduciary role, accountability, transparency, rent-seeking and soft-budget constraints. The paper's proposal hinges upon the subsidiarity portfolio, to which the state-owned bank should manage as a trustee only, so that dual governance could be enhanced. We conclude bringing forth a minimal set of dual governance principles.

Keywords: governance; public governance; dual governance; state-owned banks; subsidiarity. (search for similar items in EconPapers)
JEL-codes: D23 D73 G21 G34 H20 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2006-04
New Economics Papers: this item is included in nep-cba, nep-fin, nep-fmk and nep-pbe
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Persistent link: https://EconPapers.repec.org/RePEc:cem:doctra:319

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