Organizational Structure and Performance in European Banks: A Reassessment
Panu Kalmi and
A chapter in Advances in the Economic Analysis of Participatory & Labor-Managed Firms, 2015, vol. 16, pp 109-141 from Emerald Publishing Ltd
Abstract This paper studies the impact of ownership structure on performance in European banking both prior and during the recent crisis. We use a panel of European banks during the period 1996–2011 and utilize random effects estimations in order to identify differences in bank performance (profitability, loan quality, and cost efficiency) due to differences in ownership structure. Both stakeholder and shareholder banks have distinct advantages, shareholder banks showing better profitability before the crisis but stakeholder banks having higher loan quality before and during the crisis. Differences in profitability and loan quality between stakeholder and shareholder banks before the crisis are especially pronounced in countries that experienced a banking crisis after 2007. There is strong a heterogeneity in performance between different stakeholder ownership groups. With the exception of private savings banks, profitability and loan quality of stakeholder banks has improved relative to that of general shareholder banks during the crisis years. The paper contributes to the previous literature by comparing pre-crisis and crisis performance and includes more refined ownership classifications. The results indicate that the survival of the stakeholder model is due to its competitive advantages. Our findings provide support for those arguing that the diversity of organizational structures is worth preserving. Ownership pluralism should become a policy objective in the banking industry.
Keywords: European banking; shareholder banks; cooperative banks; savings banks; performance; organizational structure; G21; G32; G34; P13 (search for similar items in EconPapers)
References: Add references at CitEc
Citations: View citations in EconPapers (18) Track citations by RSS feed
Downloads: (external link)
http://www.emeraldinsight.com/10.1108/S0885-333920 ... RePEc&WT.mc_id=RePEc (text/html)
Access to full text is restricted to subscribers
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eme:aeapzz:s0885-333920150000016011
Ordering information: This item can be ordered from
Emerald Group Publishing, Howard House, Wagon Lane, Bingley, BD16 1WA, UK
http://www.emeraldgr ... ies.htm?id=0885-3339
Access Statistics for this chapter
More chapters in Advances in the Economic Analysis of Participatory & Labor-Managed Firms from Emerald Publishing Ltd
Bibliographic data for series maintained by Charlotte Maiorana ().