Does corporate governance explain the quality of bank loan portfolios?

Vera Fiador and Emmanuel Sarpong-Kumankoma

Journal of Financial Economic Policy, 2020, vol. 13, issue 1, 31-44

Abstract: Purpose - The purpose of this study is to assess the impact of corporate governance variables on the quality of bank loan portfolios. Design/methodology/approach - The study used a panel-corrected standard errors estimation model with the most recent 11-year data from 2006 to 2016 on selected Ghanaian banks. Findings - The findings indicate that corporate governance is relevant within the banking sector and plays a key role in improving loan quality. Having a large board with the attendant pool of expertize, boards with mostly non-executive members and duality of the CEO-board chair can be harnessed to improve bank loan quality. Female participation on boards seems to detract from good performance, creating the impression of tokenism in the Ghanaian banking sector. Originality/value - The study has important implications for board construction within the banking sector and the discourse on bank asset quality.

Keywords: Corporate governance; Asset quality; Bank loan quality; Banking sector; Gender diversity; Non-performing loans; NPLs; Banks; Financial institutions and services; Corporate finance and governance (search for similar items in EconPapers)
Date: 2020
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eme:jfeppp:jfep-06-2019-0130

DOI: 10.1108/JFEP-06-2019-0130

Access Statistics for this article

Journal of Financial Economic Policy is currently edited by Prof Franklin Mixon

More articles in Journal of Financial Economic Policy from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().