Corporate Governance, Financial Innovation and Performance: Evidence from Taiwan’s Banking Industry

Lie-Huey Wang and Xin-Yuan Cao
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Lie-Huey Wang: Department of Finance, Ming Chuan University, Zhong-Shan North Road, Section 5, Taipei 111, Taiwan
Xin-Yuan Cao: Department of Finance, Ming Chuan University, Zhong-Shan North Road, Section 5, Taipei 111, Taiwan

IJFS, 2022, vol. 10, issue 2, 1-17

Abstract: This study explores the effect of corporate governance on financial innovation and the effect of financial innovation on performance in Taiwan’s banking industry from 2011 to 2019. The results find that the banks have higher shareholding of institutional investors, ratio of independent directors, attendance rate of directors, average education level of directors and more directors with a financial or accounting background, the greater innovative financial services offered by banks. After 2015, the impact of corporate governance on banks’ innovative financial services has increased. Moreover, the greater financial innovation services, the higher the bank profitability and value, especially after 2015. Finally, offering more innovative financial services can enhance the value of financial-holding subsidiary banks; by contrast, doing the same might negatively affect the profitability of nonfinancial-holding banks.

Keywords: corporate governance; ownership structure; board structure; financial innovation; bank performance (search for similar items in EconPapers)
JEL-codes: F2 F3 F41 F42 G1 G2 G3 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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