The Effect of Ownership Concentration on the Performance of Nigerian Banking Industries, An Empirical Investigation

  • Sebastine Ugwuegbe Caritas University Emene, Enugu Nigeria.
  • I.G. Okafor Department of Banking and Finance, Caritas University, Enugu, Nigeria.
  • Ugwuegbe Ugwuegbe Department of Banking and Finance, Caritas University, Enugu, Nigeria.
  • Ezeaku Hillary C Department of Banking and Finance, Caritas University, Enugu, Nigeria.
Keywords: Ownership Concentration, Bank Performance and Agency Theory.

Abstract

This study investigated the effect of ownership concentration on the performance of the Nigerian banking sector for the period of 2008 to 2014.The study employed a sample of 5 major commercial banks in Nigeria selected on the bases of size. The data for the study was generated from the annual report of each of the banks under study for the period covered. We employed pooled panel data regression analysis to empirically evaluate the data. Both accounting and market based performance were employed with ROA and ROE as the key variable to proxy accounting based performance while EVA were used for market based performance. The result of the pooled panel data analysis reveals that ownership concentration has positive but insignificant effect on both the accounting and market based performance measures employed in the model. On the same vain, firm size which was used as a control variable has a positive and significant effect on both accounting and market based measure of banks performance. We therefor recommend that as concentrated owners seek to increase their interest, appropriate legal and control measures should be put in place to ensure that major owners don’t control the banks to their own advantage and to the expense of minority shareholders and the public at large.

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Published
2016-06-03
How to Cite
Ugwuegbe, S., Okafor, I., Ugwuegbe, U., & Hillary C, E. (2016). The Effect of Ownership Concentration on the Performance of Nigerian Banking Industries, An Empirical Investigation. Journal of Research in Business, Economics and Management, 6(2), 835-844. Retrieved from http://scitecresearch.com/journals/index.php/jrbem/article/view/725
Issue
Vol 6 No 2: JRBEM
Section
Articles

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