Enterprise Governance, Investor Trust and Liquidity in the Banking Industry: Evidence from an Emerging Economy

Alexander Maune (alexandermaune6@gmail.com)
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Alexander Maune: CEMS, University of South Africa, South Africa

Journal of Internet Banking and Commerce, 2017, vol. 22, issue 02, 01-25

Abstract: This article provides a descriptive examination of the role of enterprise governance in restoring investor trust and liquidity in the banking industry. For the purpose of this study, data was gathered through consulting secondary sources such as financial statements, company publications, annual reports, central bank reports and journal articles. The article looks at the shift in focus towards enterprise governance and its effectiveness in restoring investor trust and liquidity in Zimbabwe. The value and number of transactions going through the banking system had significantly reduced compared to the situation that prevailed in the late 1990s. This reflects the state of the economy and the decline in investor trust and confidence in the banking sector. Low liquidity and low investor confidence remains the main worry for regulators as deposits are concentrated in only five banks with the remaining the institutions sharing the remainder. The deposit market share structure signifies an oligopoly banking sector where few banks dominate the market. The findings from this article will assist policy formulation, policy implementation and further future research. This article, however, is of great importance to government, the private sector and the academia.

Keywords: Enterprise Governance; Corporate Governance; Investor Trust; Liquidity; Banking Industry; Financial Sector; Emerging Economy (search for similar items in EconPapers)
JEL-codes: A11 (search for similar items in EconPapers)
Date: 2017
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